The True Cost Of Underinsuring Your Home Building And Contents
If youve ever been tempted to decrease the sum insured for your home and contents in order to obtain a lower premium, think again. You may end up paying a far higher price than you imagined.
Whenever we take out an insurance policy, we are entering into a contract with the insurer. Whether household, motor vehicle, personal accident or any other type of policy, it is a legally binding contract between the insurer and the insured.
For householders, insurance of home building and contents is vital, not merely for peace of mind but to maintain the lifestyle they are accustomed to if the unthinkable should happen.
There are several aspects to consider when purchasing household insurance.
The insured has a duty to disclose to the insurer anything that they know or could reasonably be expected to know is relevant to the insurers decision to accept the risk and, if so, on what terms. For obvious reasons, this is called the Duty of Disclosure.
Each party to the contract (i.e.: insured and insurer) has an obligation to each other in accordance with the clause of Utmost Good...
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