Risky Business

March 2012

People On Hand

Welcome to this month's edition of "Risky Business".

This month we discuss Under Insurance and the risks associated with Under Insuring your Assets. 


Also, look out for information on the upcoming "Wilston Winter Magic Fair".


  Insurance News 

Under Insured
Beware of Under Insuring your Assets


Too many people do not carefully insure for the full replacement or reinstatement value of their property, leaving them well short in the event of a total loss. 
In fact it can be even worse if there are Average or Co-Insurance clauses in policies. these are applied to minor losses and basically pay the same percentage of a minor loss as you should have been insured for (though the Insurance Contracts Act specifies a slightly different formula), if insured for less than 80% of the full replacement value. 


What is Under-Insurance?


The Insurance Council of Australia defines this as "the result of nominating a value for an asset such as your home that is too low to actually replace it in the event that it is lost or damaged".
In 2005 the Australian Securities and Investments Commission (ASIC) estimated that 70% of Australian homes were under-insured. While Average Clauses seem to have largely disappeared from Householders policies, it is a total loss claim where the crisis of under insurance is highlighted. Yet it would not have cost much more to fully insure. 


Why do People Under Insure?


While some may deliberately choose to under insure to save money on their insurance premiums, the majority of these appear to be due to these issues being overlooked by policy holders.
An Insurance Broker may review your insurance needs each year, he can only go by the information provided by the Insured. Insurance Brokers are not Valuers or Estimators. The Insured needs to know what their assets are and needs to obtain specialist assistance to calculate what it would cost to replace or reinstate them.
Avoiding the consequences of underinsurance is really a matter for our Insureds. Only the owner of a building or its contents can take responsibility to determine the amount of insurance they wish to take out over their assets. Likewise only the Business Owner or operator is in the best position to avoid under insurance with their business or commercial policies. Click here to read more. 


Wilston Winter Magic Fair
The "Wilston Winter Magic Fair" is on Sunday, 3rd June 2012 and CPR Insurance Services are proud to be one of the sponsors and participants. 
The streets are closed around the Village for the day and the community comes together for partying, market stalls, amusements and other entertainment. Mark it in your diary now and we look forward to seeing you there! 


  Joke of the Month 

Pirate Parts
Pirate Parts


A pirate walked into a bar, and the bartender said, "Hey, I haven't seen you in a while. What happened? You look terrible."


"What do you mean?" said the pirate. "I feel fine."


"What about the wooden leg? You didn't have that before."


"Well," said the pirate, "We were in a battle, and I got hit with a cannon ball, but I'm fine now."


The bartender replied, "Well okay, but what about that hook? What happened to your hand?"


The pirate explained, "We were in another battle. I boarded a ship and got into a sword fight. My hand was cut off. I got fitted with a hook but I'm fine, really!"


"What about that eye patch?"


"Oh," said the pirate, "one day we were at sea, and a flock of birds flew over. I looked up and one of them pooped in my eye."


"You're kidding," said the bartender. "You couldn't lose an eye just from bird droppings."


"It was my first day with the hook."




See you next month.




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