Prevent underinsurance on your home insurance. Insurance broker AON came with this somewhat threatening message in June of this year, because many people have done a lot of odd jobs in Corona times. So people should insure more, that was my first thought. But that was not quite right. Underinsurance on your home insurance can indeed occur after all the renovation and refurbishment of your house. That became clear when I saw some more figures. Figures about the enormous size of all odd jobs.
Underinsurance on your home insurance after a major job is quickly a fact.
In Corona times, boredom hit quite a bit in many households. All kinds of chores that had to be done for a long time were now tackled. In my own hometown, Bergen op Zoom, I already heard of long queues of cars with trailers for the environmental street. Apparently people were cleaning up a lot. Statistics Netherlands reported turnover increases of more than 25% in the months of March and April compared to the previous year.
I also heard from customers with a handyman company, and from painters and plumbers, that they suddenly could hardly handle the work. It turned out that it was often not about chores, but about decent jobs, including major renovations. What else could you do, now that you can’t go anywhere, so many thought. Of course, underinsurance on your home insurance does not occur quickly after painting a few walls. But an extension, solar panels, an expensive new kitchen, or luxurious dormer window can of course be quite expensive. And who then thinks about home insurance?
With older home insurance policies, the chance of an insured amount that is too low is real.
Underinsurance on the home insurance actually only threatens with older policies. In other words, if those insurance policies have been taken out for more than five to seven years. Usually, the value that had to be insured was determined with the so-called reconstruction value meter. An insured amount rolled out, and you immediately received a (temporary) guarantee against underinsurance. However, those deadlines often expire. Often nobody thinks about filling in a new value meter again. After a period of five years, for example, the guarantee against underinsurance expires.
However, due to all the improvements and embellishments, the rebuilding value of your home can have risen considerably. And the insured amount has therefore become too low. And then there is underinsurance on your home insurance. This not only affects you if the entire building is lost, but also in case of minor damage. In that case, the insurer will pay less in the event of damage.
Als er onlangs zonnepanelen zijn geplaatst is het helemaal oppassen, want die zijn vaak niet automatisch meeverzekerd.
AON therefore had a point with the warning in June 2021.
How to prevent underinsurance on home insurance?
To avoid “hassle” with reconstruction value meters and discussions about the amount to be insured for your home, it is advisable to modernize your home insurance (or have it updated). It has been possible for some time now to take out insurance that automatically includes the guarantee against underinsurance. No more complicated calculations to determine the rebuilding value, but no more than five questions that the insurer asks to determine the sum insured. New techniques, such as the use of Big Data, help with this. The chance that you will be affected by underinsurance on your home insurance due to a major renovation job is then a lot smaller.
I am happy to advise you about it. Request a quote for your insurance package for modern home insurance here. Then we look for the best solution together.
Kees van den Berg
Kees van den Berg was an inspector at Delta Lloyd for a number of years. He has been an independent insurance adviser since 1988. Insurance on the internet has grown rapidly, but consumers and entrepreneurs often miss human contact. Depremie Comparison.nl has therefore remained an ordinary “old-fashioned” insurance office. With the personal service of the past and the digital technology of today.