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Building and Contents (Property) insurance is cover you really cannot afford to be without whether as an Owner or a Tenant. For this, and
all other types of insurance,the same basic principles apply: make the most of a competitive market by using AA Insurance Brokers and when it comes to renewal; read the policyto make sure it offers the cover you need, and be aware of the excesses and exclusions.
What are the key factors to be aware of, and how can you save money when you come to buy?
When you buy a house or condo you will need to take out insurance to cover the full replacement cost of the (which is quite different from the amount it is worth on the market). For example, a house valued at 10 million baht, may not actually cost 10 million to rebuild. The cost of the land will be a major portion of the house value, therefore when valuing a building for insurance purposes, the cost of the land needs to be deducted. A good guide is to calculate the size of the building (in sqm) and multiply by the latest per sqm building cost. Therefore, a 100 sqm house at say 25,000 baht per sqm, would have an insurance rebuild value of 2.5 million baht. Obviously, the rebuild cost varies, but this is a good guide.
As well as the structure of the building, this insurance covers permanent fixtures such as baths and toilets, kitchen cupboards and interior decoration. You will be covered for damage to your home by events such as fire, falling trees, lightning, water leaks and theft. You should be aware that in general ‘flooding’ which is different to ‘water damage’ is NOT covered in the standard policy, therefore this needs to be added as an extension.
The final insurance sum will be shaped by various factors including the postcode, the local crime rate, and subsidence and flooding risks for the area, as well as your own claims history and the size of your house.
Whether or not you own your own home, it is sensible to insure your possessions against fire, theft, weather damage and other risks. Standard policies cover furniture, clothes and other belongings in the home. You should list all items that have a value above 15-20,000 baht. If you don’t and you make a claim, the insurer may not pay out the full value.
If you have specific valuables to be insured, for example, jewelry, important documents, antiques etc, these need specific cover, which is rarely part of the standard insurance package.
Extensions include ‘all risks’ cover, which provides insurance outside the home for personal items such as luggage, cameras and
handbags. Cover against accidental damage is also offered as an extension. To put this in perspective: your sofa would be covered under a standard contents policy if it were damaged by a water leak, or caught fire, or was stolen, but you would need
accidental damage cover in order to claim if you knocked a bottle of wine over it.
Most people seem to purchase house insurance for their condos. However, this is completely unnecessary as you don’t need to insure the building itself. You only need to cover the contents and any 3rd party damage. AA Insurance Brokers for example, can offer ‘Condo Safe’, an exclusive package, specifically designed for condominium owners. The saving over standard house insurance is dramatic.
The obvious way is to use AA Insurance Brokers. They will provide a range of quotations to suit your requirements. Some choose to go to a particular insurance company direct, in the belief they will get a better deal. Unfortunately, it doesn’t work like that. Not only do you lose the benefit of choice, but AA Insurance Brokers can more often than not get you a lower price, plus the added benefit of someone on your side when it comes to making a claim.
You can choose NOT to insure your property, but after paying a large sum of money for your newly acquired asset, it doesn’t make sense not to spend a few thousand baht more and get the piece of mind of knowing you’re covered in the event something goes wrong…..
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