A simple example
A building policy might show A$600,000 as its sum insured while the whole property is estimated at A$950,000. Those figures describe different things: building cover and the property’s market value.
What to keep in your records
Keep the sum insured, covered asset, cover period and policy schedule together. Note when the amount was reviewed and distinguish building cover from contents or other benefits.
A common mix-up
A property’s sale price includes factors such as land. It is not automatically the right rebuilding figure or the amount payable under an insurance claim. Read ASIC Moneysmart’s explanation.
