Tower’s on a mission: To lift confidence in the insurance industry

New Zealanders are more likely to lose their home because of a fire than anything else. But “sum insured” policies, the industry standard since 2013, mean customers don’t necessarily get a full rebuild. Tower is changing all that.

In the event of a devastating life event, customers seeking insurance want to be listened to, and for things to be resolved quickly, says Tower’s head of claims Helen Quirk.

“Tower’s mission is to give people the confidence that things will return to the way they were, should something unforeseen happen in their lives,” she says.

In October, Tower reintroduced full replacement cover for New Zealand houses destroyed by fire, bucking the industry trend which, since 2013, has been to cover only for “sum insured”.

Quirk has been amazed at the way customers have responded to Tower’s move. 

“I have only been with the company since October and have been stunned at the response. Customers are sending in hand-written letters, saying how glad they are to have the cover,” she says.

In 2013, the insurance industry made the move to a values-based system known as sum insured, which is the maximum amount an insurer will pay out on a claim.

We understand that people don’t think a fire will destroy their house, and when it does, it can be very traumatic and stressful. We know customers want quick resolution, support and security when they lose their home, or their house is badly damaged by fire. - Tower’s head of claims, Helen Quirk

It essentially means that if you lost your house, an insurer would pay the costs for the rebuild up to the sum insured. If it cost more than the sum insured, you would make up the shortfall.

“While sum-insured looks good on paper, in practice, it can be problematic. People have found it hard to understand,” Quirk says.

Quirk concedes there is distrust among the public about insurer’s ability to look after their needs, following the Christchurch earthquakes and problems with claims.

“We want to fill that gap,” she says. “Total loss cover is giving people the confidence should they lose their house to fire, things will be the same as they were before,” says Quirk.

Tower can guarantee your home will be fully rebuilt, if it’s destroyed by fire, regardless of the cost or the sum you’re insured for, she says.

“We will look at things like your house fittings, and replace them to an equal standard. If you had beautiful, ornate fittings from a boutique store, we will ensure you get something as close to that as possible,” she says.

“The same policy is applied to house contents. If you got your jeans from Kmart, Jeans West or Gucci – we’ll replace those jeans from the exact same shop, ” says Quirk.

Tower understands that a house fire can happen to anyone, and the impact is totally devastating, she says.

At the time of writing, one of Quinn’s claim team was dealing with a customer who had lost their house due to fire and there had been a fatality.

 “They are on-site with the customer, and giving them moral support. That’s important for us; it’s about that moment of empathy and helping and guiding people though what can often be an extremely hard situation.”

Only about 10% of Kiwis consider losing their house to fire to be a high risk, despite fire being the most common reason for the loss of a home, after natural disasters, according to a Horizon Research survey.

“We understand that people don’t think a fire will destroy their house, and when it does, it can be very traumatic and stressful. We know customers want quick resolution, support and security when they lose their home, or their house is badly damaged by fire.”

“We’re pleased to be able to offer an improved level of cover for people’s biggest asset – their homes. We can guarantee that level of service, backed up by our total fire cover policy,” says Quirk.