House insurance is a must-have for anyone stepping onto the property ladder for the first time. Without it, banks aren’t usually willing to lend, and your home isn’t protected in the event of damage or destruction.

However, having home insurance doesn’t always mean you’ll receive coverage for everything that goes wrong in your home. Asbestos is an example of that. Here’s what you need to know about asbestos and home insurance. 

Is Asbestos Covered by Home Insurance?

It’s a loaded question, and we can’t speak on behalf of insurance companies. However, in most cases, asbestos isn’t covered by home insurance. Read through your home insurance policy, and you’ll likely find a long list of exclusions, with asbestos often appearing on that list.

Some insurance companies go into great detail about the houses they will and won’t insure. Under House Plus cover through Tower, you’ll find the following information about asbestos:

“Your policy does not cover liability for asbestos where such liability directly or indirectly arises out of, results from, or is a consequence of, or in any way involves asbestos, or any materials containing asbestos in whatever form or quantity.”  

https://www.tower.co.nz/wp-content/uploads/2021/03/House_Plus.pdf

AA Insurance operates with a similar policy. Theirs states that ‘this policy does not cover any loss, cost, or liability caused by, arising from, or involving pollution or contamination. This includes, but is not limited to any contamination from asbestos, or by the use, consumption, storage, or manufacture of illegal drugs.”

https://www.aainsurance.co.nz/manage-policy/policy-documents/home-insurance-policy-document

These are just two of many home insurers in New Zealand, and there’s nothing to say all will have the same stance on asbestos. However, the general rule is that very few, if any, claims made for your house regarding asbestos will be accepted. 

There are, of course, always exceptions to any rule. Sometimes, in rare situations, asbestos removal might be covered if it was disturbed or exposed by a peril that your insurance company does cover. An example might be if high winds caused a tree to fall on your house. There may be some degree of leniency for such situations. After all, the asbestos didn’t cause the tree to fall; high winds did.

Will Home Insurance Cover Renovations with Asbestos-Containing Materials?

In an ideal world, we’d all be able to undertake renovations without having to worry about encountering anything hazardous. Sadly, that’s not the case with many homes built before 1990. Many homes in Aotearoa New Zealand have asbestos-containing materials. We just don’t always know about it.

So, if you purchase a home and plan to undertake renovations, you might be curious about whether your insurance company will cover you if you find asbestos in your property. The answer is no. If you’re aware of asbestos in a home before buying it, you may be able to negotiate a lower purchase price to factor in the costs of removal. Otherwise, if you encounter it alone, you’ll need to cover those costs yourself.

Will Insurance Companies Insure Properties Containing Asbestos?

Not all properties are perfect. Some contain building materials and hazards we’d prefer they didn’t. It’s only natural to be worried about insurance companies not insuring properties with hazardous materials. After all, many insurance companies won’t insure properties with Dux Quest plumbing or old scrim walls.

As a general rule, insurance companies will insure a house with asbestos. However, they won’t take on the costs of asbestos and will exclude any related losses. Every insurance company is different, so always read through your policy documentation carefully to ensure you understand everything before signing on the dotted line.

What Can I Do About Asbestos?

Any restrictions on home insurance can be problematic. You might be confident that any asbestos you have in your home won’t pose a problem, but that doesn’t mean you want it in the back of your mind forever. Fortunately, you have options!

Consider removal through a licensed asbestos removalist. Asbestos removalists can undertake testing to understand the extent of it before providing you with options for its removal.

However, it’s important to note that removal isn’t always the best or only option. Some experts recommend encapsulation if removing it is going to increase your chances of an exposure event more than leaving it in place would.

For example, rather than lifting your asbestos lino flooring, you might place boards over it and add new lino on top. You might also choose to encapsulate a popcorn ceiling rather than remove it.

Time for Removal?

Let’s face it; asbestos is a nuisance. No one wants it in their home, and it has the potential to cause nightmares for people as far as insurance is concerned. If you have asbestos-containing materials in your home that you want to see the back of, contact Chemcare today. We can advise you on the best course of action for your unique situation.