REBUILDING OR REPAIRING YOUR HOME- HOME BUILDINGS INSURANCE

REPLACEMENT POLICIES

If the insurer agrees to pay a claim, a replacement policy means it will pay the cost of rebuilding or repairing any part of your home that suffers loss or damage. It will be rebuilt or repaired so that, as far as possible, it is returned to its former state. Where possible the insurer will match building materials and such. Under a replacement policy the insurer will pay the smaller of:


The insurer will pay only the costs which you actually incur. Under a typical policy, you must start rebuilding or repairing your home within 6 months from the date on which the loss or damage occurs unless the insurer agrees in writing to a longer period. It reserves the right to pay the builder directly.

Under a replacement policy the insurer may apply depreciation and cash settle a claim if you:


Any depreciation applied will be based on the age and condition of your home.

If you have a replacement policy, you may rebuild or repair your home in any way you like. In rebuilding or repairing you may change the materials, plan, specifications, or size. If you have to rebuild your home, you may also change the site. If the changes to materials, plans, specifications or size increase the cost of rebuilding or repairing your home, you will have to pay the difference. Under this section of the policy the most the insurer will pay is the sum insured.

See
building fees and related expenses

Compare with
Indemnity policies

If the insurer agrees to pay a claim, an indemnity policy means it may apply depreciation before we make any payment. The insurer reserves the right to decide whether to:


Under this section of the policy the most the insurer will pay is the sum insured.