Protecting the things that matter
Whether you own or rent your home, it's important to take out
insurance to cover the cost of replacing or repairing your
household items and possessions if they are damaged, lost or
stolen. Here we explain what these policies cover, and how to
choose the right one for you.
What is contents
Contents insurance covers the personal possessions you have in
your home if they are damaged or lost. It can include things like
furniture, clothes, computers, fridges, electrical equipment,
tools, and jewellery.
Homeowners usually combine their contents insurance policy with
home insurance into a
single home and contents policy. But these policies are not just
for people who own their home. If you are renting your home, it's
important to insure your belongings because, if the worst should
happen, landlord insurance will only cover the property the
landlord owns - your things are not included.
How much should you insure contents
When thinking about how much contents insurance you need, start
by listing all your belongings and working out what it would cost
to replace them. A good way to do this is by going room by room and
taking photos of what you own - you may be surprised by how much
Keep receipts of household goods for proof of
You may want to set up an online inventory of these details
which can be stored away from your home.
The Insurance Council of Australia's website, Understand
Insurance, has a contents
insurance calculator to help work out the value of your
Types of contents insurance
The type of cover you choose will affect the premium you pay. Some policies cover you
for defined events (e.g. burglary and fire) while others cover you
for any accidental event. Others give you only limited cover if you
take an item (e.g. a laptop) outside your home.
There are two main types of contents insurance:
- policies that cover the value of your belongings
- policies that replace your belongings with new items e.g. 'new
'New for old' policies tend to be more expensive. Work out what
type of cover you want and weigh up the costs.
You can save money on contents insurance by choosing a higher excess. For example, if you can pay the
first $1,000 of any loss, the insurance premium will be
Case study: Alina and Daniel are burgled
Alina and Daniel moved into a small apartment near the city.
They decided to get contents insurance even though their building
had a security system.
Two months later their apartment was burgled. They lost Alina's
laptop and some DVDs. The couple was very upset, but glad they had
taken the time to get the right cover. Alina's laptop was replaced
and they were compensated for the stolen DVDs.
Contents insurance for
people on low incomes
No matter how much you earn, if your possessions are important
to you, you need to protect them. It's especially important to
insure your belongings if you are on a low income and wouldn't have
the money to replace them if they were stolen or destroyed.
Good Shepherd Microfinance has worked with insurance companies
to create affordable and simple insurance policies. You can choose
between insuring contents that are worth between $10,000 and
$20,000, or you can insure a single item (like a fridge or
television). These policies have flexible payments options and some
premiums can even be deducted from Centrelink benefits.
Find out more about the Good
Insurance program on the Good Shepherd Microfinance
Insuring special collections or
Most contents policies ask you to declare 'collections'
separately. A collection can be DVDs, stamps or memorabilia, for
example. Ask your insurer what can be identified.
If you don't declare your collections, you may not be able to
claim the full amount of your loss if your collections are stolen
Most policies also only provide limited cover for valuables such
as jewellery. You may need extra cover to adequately insure these
types of items.
Paying out contents
Contact your insurer immediately if you want to make a claim on
your policy. You may be able to do this by phone, but sometimes you
will be asked to complete a claim form.
Tell the truth and include as many details as possible of the
incident. Keep and provide all documents supporting your claim.
Some insurers may offer alternative ways of settling. For
example, they may:
- repair or replace the goods
- pay you the cost of repairing or replacing the goods
- give you a cash settlement
- give you a gift card.
If you receive a gift card, remember you'll need to use it
before its expiry date and it may only be used in a particular
chain of stores. Visit our webpage on gift cards for tips on other things to be
If you have any issues with your gift card or need to arrange an
alternative settlement option, contact your insurer.
Whether you own or rent your home, contents
insurance gives you peace of mind that your most precious
possessions are covered for loss or damage.
Last updated: 22 Dec 2017