Contents Insurance

Our guide to Contents Insurance, for anyone renting a room or a property

Updated August 2018
Summary of Contents Insurance​
  • Contents insurance is usually most suitable for anyone who is renting a property and wants to protect their personal property from theft or damage, as well as cover legal liability should you unintentionally damage the home your rent.
  • Policies in our sample ranged from $400 to $700 per year for $25,000 of total cover. 
  • With most policies, you'll only be paid out if the contents are stolen or damaged by a burglary or a person unlawfully at your house - you’re not covered if the theft is by someone you have invited into your home.
  • Most policies won't automatically cover for any loss to your any contents removed from your property, i.e. if you leave your phone at a cafe or someone steals your laptop in the library. This includes bicycles too. 

Why contents insurance?
  • Contents insurance is an affordable way to protect your belongings from theft, damage or loss so that you can replace them.
  • Most policies also provide legal liability should you accidentally damage other people’s property. If you don’t have contents insurance, you may have to pay for the damage out of your own pocket, which can mean considerable debt. For example, if you break something in a shop or spill a drink over a friend's laptop, you are legally liable for the damages - contents insurance protects you from such financial loss.
  • If you would struggle no longer having a laptop, TV, musical instrument, linen, cutlery, even clothing, or even a washing machine, contents insurance is probably a good idea.

What is contents insurance?
Contents insurance will protect your belongings so that if they are damaged or stolen, you can repair or replace them. Contents insurance also protects your stuff from damage caused by a wide range of events, including water leakages, storms, flooding, fires, explosions, lightning and earthquakes.

What does contents insurance cover?
The general rule is this - if your house was turned upside down, anything that falls out of it is contents. Based on that, contents insurance covers furniture, clothing, electrical items, money and jewellery up to your sum insured. New Zealanders take out contents insurance for many reasons, and with reports of burglaries at record highs and rising, a policy is the only way to protect yourself from the unpredictable.  Contents insurance protects you from financial loss if you have to pick up the pieces after a break in. 

In this guide we list a number of tips to help you decide if contents insurance is worthwhile for your possessions, the limitations, the policies available and the costs.

Our Guide: Overview

Contents Insurance – the basics

Contents insurance is not compulsory

Your stuff is your business and whether you insure it is a personal choice. If you've got an expensive camera, phone or musical instrument and don't want to risk having to replace it if it gets damaged or stolen, contents insurance could be an idea. When you rent a property, the landlord's insurance will not cover your belongings. With hundreds of thousands of Kiwis renting their homes, contents insurance provides that safety net from the unexpected. 
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Contents insurance protects your belongings only if a 'covered event' occurs

Contents insurance cover does range between providers, so it’s essential to check the terms and conditions in detail to be sure of exactly what you are covered for. Standard cover usually means a 'covered event' will be loss of or damage to your household contents, caused directly by:
  • Burglary and theft (including attempted burglary or theft)
  • Fire, explosion, lightning, storm, flood, water damage (caused by a pipe or heating system)

Every policy differs; don't assume you'll be covered without reading the fine print. 
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Be aware of what’s NOT covered

Every policy will cover 'household contents' but the definition of that varies by insurer. Some policies will cover more than others, such as lost or stolen money and jewelry. Generally, ‘household contents’ means:
  • Domestic furniture and furnishings
  • Carpets and floor coverings that are not fixed to the floor
  • Home appliances
  • Household effects
  • Personal effects (i.e. laptop, camera, phone and jewelry)

With many policies, 'household contents' does not include:
  • Property belonging to members of your family who are tertiary students living away from the house (i.e. flatting in another property)
  • Livestock and domestic pets
  • Motor vehicles, their spare parts and accessories 
  • Business or trade tools, goods or equipment

Contents insurance policies range enormously in how much they offer, and our Best Buys section below picks out the policies that offer the most at the right price. 

Living in apartment may mean cheaper contents insurance

Apartments are generally seen by some insurers to be more secure than a house. Access is harder, there is often more security and it's just harder to break in. For this reason, if you live in an apartment you should expect a cheaper quote - make sure to mention this when you are entering in your details. 
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Some policies don't cover 'accidental damage'

If you have a history of dropping phones, spilling water on laptops or consider yourself clumsy in general, it may be an idea to buy contents insurance that covers 'accidental damage'. When getting a quote, insurers will ask what you want cover for. Many policies will provide accidental damage cover, or will provide the option to upgrade the cover to include it. 

Accidental damage can be more flexible when it comes to what an 'insured event' actually is, and this can often reduce the risk of a claim being rejected.
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Your flatmates won't be covered by your contents insurance policy

Only your contents are covered by your policy. While this sounds obvious, it isn't to everyone. For example, the TV you share with your flatmate isn't covered if it belongs to him even if you own the DVD player or have the Netflix subscription in your name.
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You’ll save the most by prepaying contents insurance annually

Insurers love being paid upfront, so if you know your living situation won't change in 12 months, you can likely save 10%-20% by paying upfront. It may be a cash hit but it's free money by way of savings, and if you do cancel the policy later on the unused months is fully refundable. 

Some policies allow situation changes if you have prepaid for a year, and will either quote an additional amount to pay or issue a refund if the new premium is lower. 
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Many factors affect what your policy costs

For renters looking to insure their personal belongings, a few factors will determine how much you pay:
  • Your address - some insurers assess certain cities or areas to be riskier, and like-for-like comparisons suggested Auckland addresses, for example, could pay 5-10% more for than regional addresses for the same level of cover.
  • Whether you live in a house or an apartment - contents cover for items in apartments can  be cheaper (but not always).
  • Your age - generally (but not always), the younger you are, the more expensive your policy - so a 22 yo pays more than a 50 yo. 
  • If you have existing contents insurance - insurers like to see a history of behaviour, so if you have had insurance before, some insurers offer lower quotes compared to someone taking out contents insurance for the first time. 
  • A burglar alarm - if you have one, your policy may reduce in price, and if it's monitored you might pay even less
  • Your claims history - if you've been unlucky and submitted claims in the last few years, your premium may be higher
  • The number of flatmates you have - this can be a factor as a higher number means more risk and potentially more to pay for a policy.

What information do I need to provide to an insurer to get a quote?

The insurer needs to know a few details before being able to quote. The process is simple, and requires entering basic information about the property and providing some simple numbers and dates.

​You’ll be asked the following key questions in most situations:
  • Address of property
  • Type of property (house, apartment, granny flat etc)
  • Burglar alarm monitored – if you have this, it will likely reduce your insurance premium
  • The sum you want insured, i.e. the replacement cost – this is really important not to undervalue if your property needs to be replaced. Contents cover is for everything, not just some items you want to insure.​
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Know how much cover you need to get the best value policy

Getting the right level of cover will depend on what you own. If you have 'valuable items' such as works of art, jewellery (including watches) and any gold or precious metal items, you will be covered to the dollar limit that is stated in the policy. It's a good idea to let the insurer know about any high value items, or ask them about any limits they have. This will help determine whether things need to be specified on the policy.

It's a good idea to keep receipts or to take photos of receipts and store them electronically. If you need to later make a claim, having these on hand will save time for you and your insurer a lot of time.

To get the right cover, it's a good idea to make a list of all of the valuables you want covered - look at the total valuables limit offered by each policy to make sure your items will be covered. If a treasured jewelry piece is worth $20,000 but the individual item payout limit is $5,000, you'll need to find a better policy. 

Ready to buy contents insurance?

Once you’ve become familiar with the basics and have decided to get contents insurance, it’s time to get the best quote for what you need. Unlike travel insurance or life insurance, there are no price comparison websites for contents insurance.
 
Get the best policy without becoming overwhelmed by the details

Tip 1 – Read our Best Buy Contents Insurance policies below to get an idea of price and coverage
We have put together a number of quotes from AA Insurance, AMI, AMP, State, Trade Me Insurance and Tower for two example situations. The purpose is to help everyday New Zealanders to understand the cover level and make it easier to pick the right policy  while reducing the chance of overpaying for cover.  

Tip 2 - Check your policy cover and excess
Make sure the policy quote offers the right level of cover, and consider what excess levels or extra coverage you are happy with. Generally, a higher excess coupled with lower coverage (in dollar terms)  equals a cheaper quote, but it's essential to make sure the cover level is sufficient when buying contents insurance (or any insurance for that matter).  

Tip 3 – Lower the excess only if you are comfortable paying more for a policy cost
If you have the right level of cover, you can pay less for a policy by choosing to have a higher excess. But it's important to make sure you can afford the excess if and when you need to make a claim.

Contents Insurance Best Buys

  • Well known insurers such as AA Insurance, AMI, AMP, State, Trade Me Insurance and Tower all sell contents insurance.
  • We obtained quotes for two example properties and specified a set level of contents cover for a 25 year old male living in an Auckland house (Grey Lynn, an inner city location) and a Christchurch house (Bryndwr, a suburban location). 
  • Policy excesses differ between insurers - we have presented quotes for the lowest excess offered per policy, and remind readers that the excess difference should be taken into consideration when purchasing a policy. 
  • For an easy-to-follow policy comparison between all contents insurance providers, download our PDF Guide
Our View: The Best Insurers
Overall, our view is that all insurers offer similar coverage with Tower and AA Insurance offering the most comprehensive benefits in their respective policies. 
 Best Buys - Example Annual Quotes for Contents Insurance in Auckland and Christchurch
All insurance policies listed below include the standard limits - specified item limits can be increased if and when requested by a customer
Example 1: House in inner city Auckland
Value of contents insured for: $25,000
Additional Item Cover? No
Background: Applicant has no previous or existing insurance (therefore no claims history) and is living with four flatmates in total in a property rented from a landlord. No burglar alarm, no history of property damage.
Our Pick - Best Overall Value
  • AMP - $400.16 with a $300 excess; $1,000 per item of jewellery (with a $4,000 total limit), $500 for money and replacement value for anything else of value. 
Example 2: Christchurch 
Value of contents insured for: $25,000
Additional Item Cover? No
Background: Applicant has no previous or existing insurance (therefore no claims history) and is living with four flatmates in total in a property rented from a landlord. No burglar alarm, no history of property damage.
Our Pick - Best Overall Value
  • Tower - $515.30 with a $250 excess; the standard policy covers replacement value and up to $1,000 for a mobile phone, $500 for money/cash, $2,500 per jewellery item and standard replacement value cover for camera equipment, musical instruments and bicycles. 

How to make a claim on your contents insurance

In almost every case, making a claim will be an easy process. Knowing your content insurance policy’s excess level and terms and conditions will limit any nasty surprises.  To have the best experience making a claim, follow these steps:
  1. Immediately after an event occurs, you must take all reasonable steps to prevent further loss
  2. Call the police in case of theft, burglary or vandalism
  3. Take photos of any damage
  4. Contact your insurer and give the full details what happened. They may ask for proof of ownership and a police report. It is likely they will ask you to complete a claim form - submit this as soon as possible with all the paperwork they require.
  5. Refrain from repairing or replacing the item(s) you are claiming on - your insurer will always need to provide permission.
  6. If possible, keep any damaged property for the insurer to inspect and assess loss
  7. Provide the details of any person who may be responsible for the damage or loss

If your claim is rejected, appeal and complain
  • Your insurer should inform you, in detail, why the claim was rejected and how it falls outside your policy.
  • If you disagree, jump on the phone and explain why your claim meets the T&Cs of the policy you bought.
  • If the insurer still refuses to cover your claim, ask your insurer for a "letter of deadlock". This letter lays out why the insurer disagrees with your claim. Once you have the letter of deadlock, you can access the Insurance & Financial Services Ombudsman Scheme which resolves disagreements between customers and their insurers.
  • Their free-of-charge service will make the final decision about your claim and order the insurer to pay out if they find in your favour. 
  • If your insurer isn't a member, you can complain to Financial Services Complaint Ltd who follow a similar process.