​Getting to know your Sum Insured

When you have replacement home insurance, choosing the right Sum Insured is really important but it can be tricky to get it right. We’re here to help you understand how to calculate your Sum Insured and reduce the risk of you being underinsured.

Introducing Cordell Sum Sure

The Cordell Sum Sure calculator can help you estimate your home’s Sum Insured quickly and easily.

The estimated figure generated by the calculator is based on the estimated cost to rebuild your home and includes anticipated construction costs, allowances for professional fees, demolition and removal of debris.  

Calculate your Sum Insured.

So what is a Sum Insured exactly?

When you take out your replacement home insurance policy, we’ll ask you for the Total Sum Insured, which is made up of the Home Sum Insured and any sums insured for Special Features. It is the maximum amount, after any applicable excesses, that is payable for the rebuild of your home in the event of a total loss for example – if your house burnt down, was destroyed in an earthquake or suffered significant damage from flooding.

Even if you’ve had your home insurance for a while, it’s important to check your Sum Insured each year. It needs to take into account rising building costs, inflation and any changes to your home.

What Sum Insured is:

  • The total amount it would cost to rebuild your home on its current site, including any Recreational Features such as swimming pools and tennis courts, Retaining Walls and Special Features, such as jetties.
  • An amount you need to choose. You can use the Cordell Sum Sure calculator to help estimate your Sum Insured or you can arrange for an insurance valuation.

What Sum Insured isn’t

  • the rateable value set by the council
  • the purchase price
  • the market value
  • the land value
  • It doesn’t automatically include Special Features (like jetties, bridges and cable cars) unless you add extra cover to your policy

So why is it important to get it right?

Your Sum Insured should cover the full cost of rebuilding your home to its equivalent  size and quality, including the cost of demolition, consents and other fees. If you set your Sum Insured amount too low and you need to repair or rebuild your home, you may:

  • have to rebuild to a lesser size or quality; or
  • have to pay for some of the repairs or rebuilding yourself.

Working out your Sum Insured

When working out your Sum Insured, you’ll need to consider a range of things about your current home and the cost to rebuild it. These include:

  • Demolition costs
  • Council fees and consents
  • Professional fees
  • Labour costs
  • Floor area of your home
  • Land slope
  • Construction materials
  • Quality of the materials and finish
  • Fixtures and fittings (i.e. oven, heat pump, toilets and baths)
  • Fixed floor coverings (i.e. carpet)
  • Number of levels in the home
  • Design – villa, bungalow, contemporary, one-off architectural
  • Outbuildings such as granny flats, detached garages or carports,
  • Driveways, decks, paths and fences

Remember to include any Recreational Features (such as swimming pools and tennis courts), Retaining Walls or Special Features (such as a bridge or cable car) that would increase the rebuild cost of your home. You may need to add extra cover for Recreational Features or Retaining Walls if their cost is more than the policy limit. If you have Special Features, remember to tell us what they are and what they cost as they are not automatically covered. Make sure you check your Policy Wording for everything you need to include in your Sum Insured .

What do I need to do?

Are you new to Lantern? Been with us for couple of years? Built or bought a new house? Don’t know where to begin? Take a look below to see where you fit in.

New to Lantern

Thanks for choosing us. To get a quote you’ll need to calculate your Sum Insured.

You can use the Cordell Sum Sure calculator or contact an expert.

You will need to:

1. Work out your Sum Insured

2. Call us to get a quote on 0800 800 800 

Already with Lantern

We appreciate the trust you put in us to insure some of your most treasured possessions.

It’s a good idea to review your Sum Insured at least every year due to the changing cost of construction, or if you’ve made any changes or additions to your property since you last reviewed your Sum Insured .

You will need to:

1. Work out your Sum Insured

2. Let us know the new Sum Insured. You can do this at any time, but especially at renewal or when you make changes to your home.

I’ve just bought or built a house.

Congratulations. It’s no easy feat building or buying a house.

It’s important not to rely on the market value or purchase price to work out your Sum Insured as the cost to rebuild can often be very different than the cost to purchase a home.  If you have recently built a house, you could use the build cost, but remember to add the cost of demolition, consider all parts of your home that are covered by the policy and inflation that may have occurred since that build price was agreed.

You will need to:

1. Work out your Sum Insured

2. Let us know the Sum Insured so we can add it to your policy.

Calculating your Sum Insured

Use the Cordell Sum Sure calculator

The Cordell Sum Sure calculator helps you to estimate your Sum Insured. It saves you a lot of leg work by pre-populating your property information, which you can then check and update to provide a more accurate estimate. The calculator draws on publicly available data from around New Zealand about many aspects of home construction and reconstruction and is updated regularly.

The calculator includes professional fees, demolition and removal of debris and will account for price difference in some of these services throughout New Zealand. While every care is taken to provide a reliable result, the estimated rebuilding cost produced by the calculator is intended as a guide only. It also doesn’t take into consideration rising building costs over the period of your insurance policy. If you want to include an allowance for this in your Sum Insured, you’ll need to add it to the estimate produced by the calculator.

The calculator also doesn’t include GST in its estimate because your Lantern policy doesn’t require GST in the Sum Insured. GST is payable in addition to the total sum insured for Lantern home policies.

If you have any Special Features (such as a bridge, cable car or jetty) you will need to add this on top of the estimate the calculator produces as well.

Calculate your Sum Insured

Call a professional   

If you want more peace of mind that your Sum Insured is accurate, it might be useful to get a professional to assess your property. If you live in a home greater than 500sqm, or higher value than $2 million, or an architecturally designed home, this is strongly recommended.

QV and Construction Cost Consultants are registered professionals who can provide residential valuations at a competitive price for Lantern customers. Contact them below:

• QV (enter Lantern in the comments field)

• Construction Cost Consultants

Alternatively try other registered professionals, such as:

• A Registered Property Valuer 

• A Quantity Surveyor

  • More information on using the calculator

  • If your address can’t be found and it includes a unit number (e.g. 23a) try different variations (e.g. 1/23, 23/1). If your address still can’t be found, Cordell Sum Sure calculator may not have details of the property, it may be a new subdivision or the calculator is not suitable for the property at that address.
  • Don’t worry if the photograph doesn’t match your house. The photograph might be different (e.g. your house is brand new, or there is an old photo, a boundary photo or street front photo) but the property details are based on the address not the photo.
  • The calculator assumes an average floor area for any garages, sheds or pool houses, so if you have a particularly large detached building you might want to select a Sum Insured higher than the estimate the calculator provides.
  • If you’re in the Canterbury area and your property has been identified as having a CERA technical category rating (foundation requirements), then an allowance will have been made for this. This is indicative only and you should seek specific engineering advice for a reliable estimate of any costs.
  • The calculator uses typical building costs for standard finishes to provide an estimate.  If your home has significant special features and fittings,  was built to a superior standard, is very large or has a high value, consider using other options to establish a better estimate of the rebuilding cost, such as a registered property valuer or quantity surveyor, or select a Sum Insured higher than the estimate the calculator provides.
  • Factors such as the slope (steepness) of your land, the style and quality of construction are important to get right when using the calculator.  Seek advice if you are unsure what to enter in the calculator
  • This calculator has been customised for Lantern so it is important that you use the calculator provided by your insurer.

More about shared ownership

  • Owners of cross-leased properties need to consider how to cover shared assets such as driveways, fences and retaining walls . Check your property's Title documents for reference to a 'plan of flats' (or similar) that sets out the various areas the cross lease applies to, and if you're still unsure, talk to your legal advisor.
  • Body corporates should consider all the units in their multi-dwelling property as well as any common property. 

Please remember

This calculator provides an estimate Sum Insured for your home but the final decision is yours, so if you think your amount is not correct you can change it. This is general information and is not a recommendation, opinion or guidance.  If you would like a recommendation please contact a registered valuer or quantity surveyor.  This calculator information does not provide any advice or opinion on the extent or adequacy of the cover provided by Sum Insured insurance. This information is not personalised financial advice and does not take into account your particular situation. You must make your own decision on the Sum Insured that is appropriate for your circumstances.

The Cordell Sum Sure calculator is an independent tool. Lantern doesn’t have access to the information you enter, or access to the estimate that it produces, so if you’d like to adjust your home’s Sum Insured, or add additional cover for retaining walls, Recreational Features like swimming pools and tennis courts or Special Features like bridges, you’ll need to contact us. It’s your responsibility to ensure that your Sum Insured is adequate.


© IAG New Zealand Limited Privacy Policy Terms of Use

Lantern Insurance is a business division of IAG New Zealand Ltd

For a complete description of your cover, please refer to your policy wording, policy schedule and any other relevant policy documents.
This information is a general guide only and is not necessarily complete. We reserve the right to change, update or correct any information from time to time without notice.