Sum Insured for your home

All about your Sum Insured

When you have replacement house insurance, choosing the right Sum Insured is really important but it can be tricky to get it right.

It is important that you ensure your Sum Insured is adequate to cover all costs associated with rebuilding your house.

We have some helpful information and an easy to use calculator to help you to set an adequate Sum Insured.

So, what exactly is Sum Insured?

We will ask you for a Sum Insured when you take out a house policy with Southsure. The Sum Insured specified in your Policy Schedule means the maximum amount payable to rebuild your house, in the event of a total loss (a loss that requires the complete rebuild of your house, such as due to a fire, earthquake or flood).

Even if you’ve had insurance for your home for a while, it’s important to review your Sum Insured each year to ensure it’s accurate.

It’s very important that your Sum Insured is sufficient to cover the total cost of rebuilding your house, including costs to rebuild your driveway, fences, swimming pool, tennis courts, sheds, garages and any other structures. 

It should also include other costs associated with rebuilding such as demolition, debris removal, professional fees and compliance costs.

 

Sum Insured is:

Sum Insured isn’t:

  • The cost to rebuild your house on its current site, to the equivalent size and quality including features like swimming pools, retaining walls and bridges that provide the only access to the house.
  • An amount you need to specify. You can estimate your Sum Insured using the Cordell Sum Sure calculator yourself. Alternatively, our Insurance Advisers can assist you in determining your Sum Insured based on information provided by you. Or you can arrange for a valuer to assess your property’s rebuild cost on site.
  • The Council’s rateable value
  • The purchase price or market value
  • The land value
  • Automatically inclusive of features such as jetties or bridges that are not the sole access to the house, unless you’ve arranged additional cover with your broker or insurance adviser.

You can use the Cordell Sum Sure calculator to help estimate your house Sum Insured.

The rebuild cost generated by the calculator is based on the estimated cost to rebuild your house and includes anticipated construction costs, allowances for professional fees, demolition, site clearing and GST.

Calculate your Home Sum Insured

Your Sum Insured should be high enough to meet the full cost of rebuilding your house to its equivalent size and quality following a total loss.
It needs to include the cost of demolition, consents and other fees.
If your Sum Insured amount is too low you may have to rebuild to a lesser size or quality or pay for some of the repairs or rebuilding yourself.

Your Sum Insured is a figure that considers a range of things about your current house and the cost to rebuild it. The following need to be considered.

  • Demolition and site clearing costs
  • Council fees and building consents
  • Professional fees
  • Cost of labour
  •  The floor area of your house
  • Slope of land and access
  • Construction materials
  • Quality of the materials and finish
  • Fixtures and fittings (i.e. toilets and baths, oven, heat pumps)
  • Fixed floor coverings (such as carpet)
  • Number of levels in your home
  • Design style – e.g. villa, bungalow, contemporary or architecturally-designed
  • Outbuildings like granny flats, detached garages and carports
  • Driveways, decks, paths and fences

Features such as permanently fixed swimming pools or spa pools, tennis courts, retaining walls, bridges, cable cars or jetties that would increase the rebuild cost of your house also need to be considered. Some of these features may have certain policy limits or not be automatically covered, so you may need to purchase additional cover for these. Tell us if you have any of these features and what they would cost to rebuild.

Make sure you check your Policy Wording for everything you need to include in your Sum Insured.

All of this can be easily estimated using the Cordell Sum Sure calculator yourself, or by talking to a Southsure Insurance Adviser.

 

When you want to take out a new house insurance policy, or renew your current policy, you should consider the amount your house needs to be insured for.

You need to review your Sum Insured at each renewal. While we may adjust your Sum Insured at each renewal to account for changes in construction costs, we can’t know of any changes or additions you may have made to your property. If you think your current Sum Insured amount is too low, let us know if there are any changes you want to make.

If you have bought a house, don’t rely on the market value or purchase price to determine your Sum Insured as this is very different to the price to rebuild your house. If you have built a house recently, you could use the build cost, however you need to consider the cost of demolition and site clearing, as well as all parts of your house that are covered by the policy such as paths and fencing.  You also need to consider inflation that may have occurred since the build cost was established or that may occur in future, and any other increase or changes that may have occurred over the policy period. If you think your current Sum Insured amount is too low, let us know if there are any changes you want to make.

Use Cordell Sum Sure calculator

The Cordell Sum Sure calculator helps you to estimate the rebuild cost of your house based on publicly available property information and construction data. The calculator will pre-populate information about your property, which you will then need to check and update if incorrect. The calculator also includes professional fees, demolition, removal of debris, GST and will account for price differences in some of these services around New Zealand.

The calculator draws on publicly available data and is updated regularly and while every care is taken to provide a reliable result, the estimated rebuilding cost produced by the calculator is intended as a guide only. The calculator won’t take into account rising construction costs during your period of insurance, so if you wish to include an allowance for this you will need to add it manually to the estimate the calculator produces.

The calculator is designed to price standard residential rebuilds, so may not be appropriate if your house is large (>500sqm), high value (>$2m) or architecturally-designed and in these scenarios, we would encourage you to use a valuation professional.

Calculate your home Sum Insured

 

Use a registered valuation professional  

The most accurate way to estimate your house rebuild cost is to get the help of a valuation professional such as a property valuer or quantity surveyor. This is strongly recommended for large (>500sqm), high value (>$2m) or architecturally designed homes. QV and Construction Cost Consultants can provide valuations for insurance purposes at a competitive price for Southsure customers. Contact them below:

Alternatively, you can find other valuation professionals below:

More information about the Cordell Sum Sure calculator

  • If your address can’t be found and it includes a unit number (e.g. 23a) try different variations (e.g. 1/23, 23/1). If your address still can’t be found, Cordell Sum Sure may not have details of the property or the calculator is not suitable for the property at that address.
  • Don’t worry if the photograph doesn’t match your house. The photograph might be different (e.g. your house is brand new, or there is an old photo, a boundary photo or street front photo) but the property details are based on the address not the photo.
  • You need to confirm the total floor area of all levels of your property in metres squared; find this in Council information, ask a builder or measure it yourself.  Check any extensions have been included. The calculator assumes an average floor area for any garages, sheds or pool houses, so if you have a particularly large detached building you might want to select a Sum Insured higher than the estimate the calculator provides.
  • If you’re in the Canterbury area and your property has been identified as having a CERA technical category rating (foundation requirements) then an allowance will have been made for this. This allowance is indicative only and specific engineering advice should be sought for a reliable estimate of any costs.
  • The calculator uses typical building costs for standard finishes to provide an estimate.  If your house has significant special features and fittings, was built to a superior standard, is very large or has a high value, consider using other options to establish a better estimate of the rebuilding cost, or select a Sum Insured higher than the estimate the calculator provides.
  • Factors such as the slope (steepness) of your land and the style of house construction are important to get right when using the calculator.  Seek advice if you are unsure what to enter in the calculator.
  • This calculator has been customised for Southsure so it is important that you use the calculator provided by your insurer. The Cordell Sum Sure calculator adds GST to the estimate it produces because your Southsure Sum Insured is an amount which needs to include GST.

More information about shared ownership

  • Owners of cross-leased properties need to consider how to cover shared assets such as driveways, fences and retaining walls. Check your property's Title documents for reference to a 'plan of flats' (or similar) that sets out the various areas the cross lease applies to, and if you're still unsure, talk to your legal advisor.
  • Body corporates must consider all the units in their multi-dwelling property as well as any common property. 

More information about your responsibilities

This calculator provides an estimate Sum Insured for your house but the final decision is yours, so if you think your amount is not correct you can change it. This is general information and is not a recommendation, opinion or guidance.  If you would like a recommendation please contact a registered valuer or quantity surveyor.  This calculator information does not provide any advice or opinion on the extent or adequacy of the cover provided by Sum Insured insurance. This information is not personalised financial advice and does not take into account your particular situation. You must make your own decision on the Sum Insured that is appropriate for your circumstances.

The Cordell Sum Sure calculator is an independent tool. Southsure and Lumley don’t have access to the information you enter, or access to the estimate that it produces, so if you’d like to adjust your Sum Insured, or add additional cover for retaining walls, or additional features like swimming pools, tennis courts or bridges, you’ll need to contact us. It’s your responsibility to ensure that your Sum Insured is adequate.