When the Robinson’s bought Killara they insured it through insurance brokers ACM Ahlers Insurance. the policy was designed for lifestyle properties issued by Vero Insurance NZ.
They had insured their new cars with AMI when they first arrived in New Zealand in 2005 and this had continued right up until the time of the fire. AMI is another insurance company operated by IAG.
Following the decision to change the property into a Lodge in 2010, Ahlers suggested changes to the cover, a specialist policy they had created with VERO, INNSURE. This covered all the Lodge related property, contents to $600,000 and immediate replacement of items to allow continuous operation of the Lodge following accidental damage. However, it did not cover the main structure of the building or any personal contents, Ahlers suggested that the Robinson’s take out mainstream insurance company policies to cover the basic structure and personal items.
They followed that advice and supplemented the INNSURE policy with a Property cover policy with STATE INSURANCE, this was a ‘rebuild as new cover’ on the house and a small, $100,000, contents cover since all the valuable antiques and furniture were deemed to be part of the lodge operation and covered by the expensive INNSURE policy.
The policy with State insurance was in their names but the interest of their KILLARA TRUST that actually owned the property was noted along with ASB as the mortgage supplying bank. It was also pointed out that Killara was a 495sq m architect designed luxury property but this didn’t increase the quoted premium.
When the Lodge operation was suspended whilst the Robinson’s remediated the contamination issue they also suspended the INNSURE policy. Unwittingly, this action left the valuable contents uninsured at the time of the fire since they did not increase the contents cover to $600,000.
They were $500,000 underinsured when the property was destroyed along with all the contents.