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Everything you need to know about contents insurance

By MAS Team

When it comes to safeguarding our possessions and financial security, the importance of contents insurance shouldn’t be overstated. This coverage can be a shield against the unexpected, offering a safety net in the face of loss, damage or theft of your personal belongings.

Understanding the benefits of contents insurance and why it may be essential can help you to make an informed decision about your policy. Everyone’s life is different, so there’s no one-size-fits-all approach. Here’s what we’ll cover in this article:

What is contents insurance?
Contents insurance glossary
What contents insurance covers
What doesn’t contents insurance cover?
The cost of contents insurance
How to decide your level of cover
Benefits of contents insurance with MAS
How to claim on your contents insurance
Frequently asked questions about contents insurance

contents insurance - interior of house

What is contents insurance?

Contents insurance is protection for your personal belongings in the case of unexpected damage, loss, or theft. If something were to happen to your belongings, you may be able to lodge a claim with your insurer which could lead to compensation, repair, or replacement of the affected item(s).

Whether it's a sudden accident or a natural disaster, there are many scenarios where contents insurance could help. There are also often specific options for contents insurance for students, renters or even businesses.

It could be viewed as an investment in your future, offering you the potential to recover and rebuild, ensuring that life's unexpected turns don't leave you in a vulnerable position. Knowing that you have this added layer of protection can provide significant peace of mind. These objects may not hold just monetary value but sentimental importance too.

Contents insurance glossary

For someone who doesn’t work in the insurance industry, it can be challenging to understand all the jargon that is thrown around. Sure, getting an expert to take you through the insurance process helps, but it can still be helpful to understand commonly used terms from the start. Here are some that you may come across:

Policy	Your policy is the contract that is held between your insurer and you as the policyholder. Your insurance policy will outline the conditions your insurer will cover you for.
Replacement value	This term refers to the amount it would cost to replace an item you have insured under your policy. This amount that your insurer would pay out would already be agreed upon. The money could be for the exact same item or something similar, depending on the circumstances.
Sub-limit	A sub-limit is a limit within your policy that is simply a cap on how much your insurer would pay out for the loss of a particular item. A sub-limit is not to be confused with your broader coverage limit, as a sub-limit may apply to specific items or scenarios.
Automatic additional benefits	As the name suggests, automatic additional benefits are extra features or coverage included in your policy. Unlike optional benefits, you don’t need to pay extra money to get automatic additional benefits.
Protection costs	This is the cost to mitigate or minimise potential loss or damage. Some examples include adding protective fencing following a loss or installing bolts to keep the front door closed to stop people entering and causing further damage. Sometimes the insurer (like MAS) would pay for these if the situation met the intended purpose and was agreed in advance.
Reduction in value	Put simply, a reduction in value is a decrease in the worth of an item or asset that you have insured against being lost or damaged. Your insurer may consider a reduction in value when paying you out to make up any difference.
Legal liability	This is a legal obligation you may have to pay out for the damage or loss of someone else’s items or property. If your personal insurance includes legal liability cover, your insurer could financially support you to fulfil your obligation.
Hidden gradual loss	This refers to an item that may have deteriorated gradually over time in a way that isn’t easy to notice right away. If you are covered for hidden gradual loss in your policy, you may be able to claim for gradual damage such as leaks or corrosion that meet the criteria set out in the policy.
Cover	You’ll hear this word a lot when it comes to insurance. Put simply, cover is what your insurer is protecting you from, as per your policy wording. When it comes to contents insurance, you could be covered for certain losses or damage.
Duty of disclosure	Your duty of disclosure is your legal obligation to disclose information to your insurer that could impact your potential or current policy. If you don't tell us everything we need to know, it could have negative implications when it’s time to claim.
Excess	As the policyholder, excess refers to how much you agree to pay as part of making an insurance claim. Generally speaking, choosing a higher excess option can mean lower premium costs and vice versa.
Accidental	This means any damage or loss is unintended and unexpected by you and any other person insured under your policy.
Premium	You’ll often run into this word when discussing insurance, whether house insurance, contents insurance or any other policy. Your premium is the amount of money you need to pay your insurer as the policyholder for your insurance coverage.
Agreed value	This term refers to the amount that your insurer and you, as the policyholder, have both agreed on to be the value of what is being insured.

What contents insurance covers

The level of coverage within your contents insurance policy hinges on the specific terms and agreements outlined in the document. It's important to keep in mind that each insurer operates uniquely, making it a good idea to seek expert advice to fully understand your specific policy wording and coverage. Here are some things that, depending on your insurer and policy, may be covered:

Sudden accidental damage

This is the unintended or unforeseen damage or harm to your insured contents. This damage of harm generally happens without warning.

Theft

In terms of contents insurance cover, theft means when someone takes your insured property or items without your consent.

Burglary

Sometimes confused with theft, burglary is when someone illegally enters your home causing vandalism, theft or any other crime causing the damage or loss of your insured contents.

Malicious damage

This specifically means the destruction or harm of your contents that is done out of malice. So, the damage to your insured contents is not accidental but done with malicious intent.

Fire and explosion

This is the situation where there is destruction or damage to your insured contents due to an explosion blast or flame.

Weather

It’s fair to say that the weather in New Zealand can sometimes be volatile. When it comes to contents insurance, weather cover refers to damage caused to your insured belongings due to extreme or adverse weather.

Legal liability

As we’ve already mentioned, legal liability cover provides for the situation where you had to pay for damage to someone else's insured property or belongings by law.

woman upset on couch with bookshelf fallen over and books everywhere

What doesn’t contents insurance cover?

It’s also worth understanding what contents insurance doesn’t cover, especially when it comes to comparing contents insurance quotes. Generally, most contents insurance policies won’t cover:

Wear and deterioration damage.
Damage from insects or vermin.
Intentional damage by the policyholder.

It’s worth noting that these are just common examples. Each insurance policy is different.

The cost of contents insurance

The expense of contents insurance isn't fixed, it normally depends on the specifics of the policy and your unique situation. Elements like the extent of coverage, the value of your belongings, the location of your home, and individual considerations shape the price.

By understanding these contributing elements, you can make informed decisions, ensuring that you have the required cover while remaining within a comfortable budget. Insurers allow contents cover to be adapted to suit personal circumstances and needs.

How to decide your level of cover

When it comes to determining the ideal amount of coverage, seeking advice from an expert can be incredibly valuable. It's a way to gain insights that align with your specific circumstances, helping to ensure you have sufficient protection without exceeding your needs.

Assessing the value of the items you plan to insure can be critical. This step can ensure that your coverage aligns with the worth of your possessions, offering a sense of security. MAS has a contents calculator to help you figure out how much cover you may need.

Benefits of contents insurance with MAS

Each insurance provider will provide its own unique approach and benefits, so this is another reason why it can be vital to get the advice of an insurance adviser. When researching your contents insurance options, you may wish to consider the benefits of choosing MAS as your insurer.

Empathetic approach

At MAS, we’re proud of our high-quality claims service. We understand and do our best to try to assist you as much as possible with whatever is happening. We understand that you may be trying to claim at a stressful and unsettling time.

Multi-product discounts

Given that we provide several types of cover; including motor vehicle, home and contents insurance, we are often able to provide multi-product discounts. This means that if you have several policies with us, you could be eligible for a discount on your premiums.

Simplicity

As mentioned in this blog, insurance can sometimes be difficult to get your head around. Because of this, we make dealing with us as simple as possible. Our policies are designed to be in plain English and as easy for people to understand as possible.

No Claims Bonus

If you’ve held a policy with MAS for 5 years and haven’t made a claim during this time (excluding glass claims), you could qualify for a No Claims Bonus. This could mean a slight reduction in your premium.

woman on computer with kid looking at her

Automatic additional benefits

Members with MAS contents insurance get to enjoy many automatic additional benefits. These benefits don’t require any extra cost and include:

Accidental death: If the policyholder is injured and, as a consequence, dies as the result of a sudden accidental event, MAS will pay $20,000 to their estate.

Additional risks: If the policyholder’s personal effects are temporarily removed from the property’s address while travelling their policy is extended to cover them.

Alternative accommodation: If the policyholder’s main residence is uninhabitable, MAS will pay up to $50,000 for the additional and reasonable costs for alternative accommodation while the property is being assessed and/or repaired.

Business use items: MAS will pay for sudden accidental loss to any property owned by the policyholder that relates to a healthcare practice or home-based office for clerical work up to a limit.

Children's contents: MAS will cover the policyholder’s children's contents while they're in full time study and staying at boarding school, in tertiary accommodation, or while boarding in a private residence.

Contents in storage: MAS will cover the policyholder’s contents for accidental loss by restricted perils while temporarily stored in a professional storage facility.

Contents in transit: MAS will cover the policyholder’s contents for accidental loss by restricted perils while being permanently moved to a new permanent address anywhere in New Zealand.

Credit card fraud: MAS will provide up to $2,000 for fraudulent debit or credit card use for which the policyholder is legally liable and cannot be recovered elsewhere.

Cyberbullying: MAS will repay the policyholder up to $5,000 if they incur expenses caused by cyber-bullying. Their No Claims Bonus will not be affected by this.

Emergency entry: If emergency services cause damage to the policyholder’s property on entry, MAS will cover it up to $10,000.

Emergency evacuation: MAS will allow the policyholder to claim under the 'Alternative accommodation' benefit when they are denied access to their house due to safety concerns or an emergency.

Emergency recovery: If the policyholder’s property suffers a significant loss, and MAS believe that it is likely to be a claim greater than $100,000, they will help out immediately by providing a $5,000 cash benefit to assist the policyholder with recovery.

Frozen food: If the policyholder’s freezer accidentally breaks down, loses refrigerant or the power supply is disconnected, MAS will pay up to $2,000 for any spoilt items.

Hidden gradual loss: In certain circumstances MAS will provide up to $5,000 for hidden rot, hidden mildew, or hidden gradual deterioration caused by water leaking from an internal source.

Locks and keys: MAS will cover the reasonable cost of replacing locks and keys (including electronic access cards and transponders and remote door openers) if they have been lost, damaged, stolen or duplicated. No excess will be applied and the No Claims Bonus will not be affected.

Moving to a new home: If the policyholder moves house, MAS will automatically cover their contents at the new address for up to 30 days on the same terms and conditions as the existing policy.

New for old: Under MAS’s ‘replacement value cover’ option, if an item cannot be repaired, MAS will replace it with the nearest equivalent item available that is substantially the same as the damaged item was when new.

Pair and sets: If MAS is unable to repair an item of jewellery or artwork that forms part of a pair or set, and MAS is unable to repair or replace the complete pair, MAS will, at the policyholder’s request, settle the claim as if the whole pair or set was involved in the loss.

Parents’ and grandparents’ contents: MAS will cover the policyholder’s parents' or grandparents' contents automatically under policyholder’s policy while they're residing in a rest home, hospice or the like.

Personal health items: If the policyholder’s claim is solely for hearing aids, dentures, prescription glasses, contacts, walking sticks and frames or wheelchairs MAS will not apply an excess and their claims bonus will not be affected.

Protection costs: MAS will provide up to $10,000 for reasonable costs incurred to protect the policyholder’s property from loss, or following a loss, to minimise damage and prevent further loss.

Reduction in value: If MAS choose to repair or replace any item of jewellery, artwork or musical instrument, MAS pay for any reduction in current value of the item that results.

You choose the repairer: The policyholder can select their own repairer. If they select a repairer that MAS approves, MAS will guarantee the quality of their repairs completed under the claim.

The full details of each benefit can be found in your policy wording.

How to claim on your contents insurance

The process to claim on your contents insurance will vary depending on the insurer. If you’re insured with MAS, you can rest assured that it’s a simple and easy experience - there are 2 ways to start the process by:

Calling MAS at any time of the day for free on 0800 800 627.
Filling out a simple online claim form.

Whichever method you choose, you will be assigned a claims adviser. This expert will contact you within 24 hours of lodging the claim to take you through the next steps. Easy as!

suitcases at an airport

Frequently asked questions about contents insurance

We’ve covered many of the important things to know regarding contents insurance. But there are many other common questions we hear at MAS. We’ve answered them below so you aren’t left wondering.

Does your insurer let you choose your repairer?

An insurer often has a preferred repairer they choose to work with, but some insurers allow you to specify who you’d like to carry out repairs. You just need to ensure they meet conditions set by your insurer. As mentioned, MAS provides the additional benefit ‘you choose the repairer’.

Can you replace one part of a missing pair?

This will depend on the insurer and your particular policy. MAS provides an automatic additional benefit, ‘pairs and sets’, which means that if you are not able to repair or replace one part of a set, like earrings, the whole set may be replaced.

What happens to contents insurance when you travel?

Many Kiwis have been heading overseas on well-deserved holidays recently. In most instances, a contents insurance policy will cover contents that you’ve left behind in your property while travelling abroad as well as the contents you’ve taken overseas with you. In saying that, it’s important to check your policy wording. For more advice on travelling, read our guide with tips on how to protect your gear when you’re travelling.

Can you choose between repairing and replacing?

In most cases, it’s up to your insurer to decide whether an insured item should be replaced or repaired, and it may depend on the extent of the damage. MAS provides a replacement value option, which means that if an insured item can’t be repaired, it may be replaced with an item of the nearest equivalent value that is essentially the same.

Does contents insurance cover breakdowns?

There are specific motor insurance options that are separate from contents insurance. However, if an electronic or mechanical item at home breaks down, it will depend on the item and the cost of the breakdown as to whether it is covered under your contents insurance. For example, if the damage to the item was sudden or accidental, it may be covered. It may not be covered if the breakdown was due to gradual damage or corrosion.

Does working from home affect your policy?

Once again, this will come down to your insurer and specific policy. When it comes to MAS contents insurance, we can provide an additional benefit where we insure business-use items. This means if there is damage to items owned by the policyholder that are work-related, you could be eligible for a payout.

What happens to contents insurance when moving house?

Each insurer will have a different approach regarding relocation when it comes to contents insurance. With MAS, we may provide a transit benefit if you're moving property. This means that lost or damaged insured contents may be covered while you’re in transit to anywhere in New Zealand. MAS may also cover your insured contents at your new address for up to 30 days on the same terms and conditions of your existing policy.

What is the difference between home and contents insurance?

Understanding the fundamental difference between contents insurance and home insurance can be crucial when protecting your home and belongings. The two types sometimes need clarification, so it's vital to understand their differences as it will impact what type of cover you may need.

While home insurance can be essential for preserving the value of the property itself, it doesn't inherently cover the valuable items inside. This is where contents insurance steps in, helping to ensure protection for your personal belongings.

Do you really need contents insurance?

One of the significant advantages of contents insurance is the financial support it can provide. In the unfortunate event of covered losses, the policy can step in, potentially providing the necessary funds to repair or replace damaged items. This financial assistance may be invaluable, alleviating the financial strain that often accompanies unforeseen expenses, such as the replacement of essential appliances or repairs to valuable possessions.

The reassurance offered by contents insurance doesn't end at your doorstep. It can extend to wherever life takes you. Whether you're at home or travelling, the policy may ensure that your personal property is protected. If you’re frequently on the move and have valuable items that travel with you, you’ll be able to focus on what really matters – your holiday!

Contents insurance recognises that the value of some belongings goes beyond the monetary aspect. Certain items hold sentimental significance – they signify cherished memories. Contents insurance can allow you to preserve these memories by providing the means to replace or repair such items. The last thing you want is to have your favourite family heirloom damaged for good.

What are reasons not to have contents insurance?

It's important to recognise that contents insurance may not be suitable for everyone, and it's vital to evaluate your specific circumstances carefully. If you are still determining whether it aligns with your needs, seeking professional advice is a wise step to explore your options.

There are instances where other life factors might take precedence. For example, the cost of contents insurance, the extent of your possessions, or the inclusion of contents coverage within a broader home insurance package could influence your decision.

Want to learn more about contents insurance?

Armed with these valuable insights, you may want to take proactive steps to learn more. If you have inquiries or wish to explore the personalised contents insurance solutions offered by MAS, we encourage you to make a connection. Talking to an expert will help you to compare house and contents insurance options.

Let's discuss your unique needs and ensure you have the coverage that fits your life and belongings. Contact MAS today for a chat about the possibilities or to organise a contents insurance quote.

This article provides general information only and is not intended to constitute financial advice. Before taking out any insurance product, you should carefully consider the terms and specific policy wording. Underwriting criteria will apply.

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