Home & contents insurance
Protect your home
Protecting your home and possessions against damage or loss is
really important. Here's how to compare different types of
cover to help you pick a home and contents insurance policy
that works for you.
What is home and contents
Home insurance (sometimes called building insurance) covers the
cost of rebuilding or repairing the home you own. Contents
insurance covers the cost of loss or damage to your possessions,
which can include things like furniture, clothes, computers,
fridges, electrical equipment, tools, and jewellery.
These policies are often bundled together as a 'home and
contents insurance' package, but they are actually separate
policies that cover different things, so you need to work out what
cover best suits your needs.
How to choose a home insurance
Use at least three calculators to compare sum-insured
policies because the results can differ.
There are two types of home building
insurance. Make sure you understand the difference between them so
you can decide which one suits you best:
- Total replacement cover - includes all the
costs of rebuilding your home to the standard it was prior to an
event, so you don't need to worry about any shortfalls between what
it costs to repair or rebuild and the amount you are insured for.
Having a total replacement policy will reduce your risk of
underinsurance, but it's only available from a few insurers.
- Sum-insured cover - is more common and will
cover you up to a set amount to repair or rebuild your home. This
set amount is referred to as 'the sum insured'. Some sum-insured
policies also offer an 'extended cover' policy that provides up to
30% on top of the sum insured in the event of a total loss - this
could be a good way to reduce the risk of underinsurance.
All insurance policies have exclusions, caps, limits and other
conditions which can vary between insurers, so it is important to
ask questions and read the product disclosure statement (PDS) when
comparing different policies.
How to compare different policies
The details of home insurance policies differ between insurers
and even between home insurance 'brands' offered by the same
Compare the features and prices of at least three different
policies. This will ensure you have the right level of cover at the
best price. It's as simple as phoning a few insurance companies, or
visiting a few websites.
Find out what you would be covered for with each policy and what
you are not covered for (exclusions) including any caps or
You can get information about policies from the product's key
factsheet, which will be on the insurer's website, or you can ask
them to send you a copy. The factsheet summarises key information
about the policy including what you are and aren't covered for.
If you want more detail, read the product disclosure statement (PDS), which
you can also get from the insurer or their website.
If you live in North Queensland, the North Queensland home insurance
website can help you compare policies.
Is your home in a risky area?
Some homes are located in areas of increased natural risks, such
as bushfire, flood or cyclone. If you live in an area of increased
risk, it is important that your home insurance covers these events
and that you have enough insurance (sum insured) to rebuild, or
have a total replacement policy.
Most policies cover fire but not all cover for flood and
For bushfire risk, you may want to understand your home's
Bushfire Attack Level (BAL). If your home is destroyed, you may
need to rebuild it to comply with new building codes which can
increase the cost of rebuilding.
Our storms, floods and fires
webpage explains how to find out if you live in a disaster prone
best contents insurance policy
Keep receipts of household goods for proof of ownership.
Home owners 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
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
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. They made a list of everything they
owned and how much each item was worth.
Two months after they moved in, their apartment was burgled. The
thieves stole Daniel's laptop and some jewellery. They were very
upset, but glad they had taken the time to list their belongings
and get the right cover. Daniel's laptop was replaced and they were
compensated for the stolen jewellery.
How much should you insure your contents for?
To work out how much contents insurance you need, it's a good
idea to list all your belongings and work out what it would cost to
replace them. You can start by going room-by-room and taking photos
of what you own - you may be surprised by how much you have.
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 possessions.
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 website.
Insurance for special collections or jewellery
Most contents polices ask you to declare 'collections'
separately. A collection can be 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 they are stolen or
Most policies also only provide limited cover for valuables such
as jewellery. You may need extra cover to adequately insure these
types of valuables.
Picking the right amount of
Underinsurance is when you don't have
enough insurance to cover all the costs of rebuilding your home or
replacing your contents.
Some people underinsure their possessions so that they pay a
lower premium, while others simply don't update their level of
cover when they renew their insurance or renovate their home, or
they may not know how much their house or possessions are
How much cover do you need?
When working out how much cover you need, consider the
possibility that your whole house could be destroyed, for example,
by a bushfire or other natural disaster. Does your policy provide
enough insurance to cover the cost of rebuilding your house? See estimating rebuilding costs
and home insurance
Also see our webpage about storms, floods and fires for
information on insurance for natural disasters.
Does your policy reflect how much your possessions are really
worth? Your insurer will calculate your claim based on the insured
value. For example, if you only insure your contents for $20,000,
but they are actually worth $40,000, your insurance would only
cover half the replacement cost if they were damaged or lost.
Check what the policy covers
Many people only read their policy when they need to make a
claim, but then it's too late to make any changes. If you already
have insurance, check your policy now to see how much your insurer
will pay and under what circumstances.
Also check when your insurer will reject a claim. For example,
some insurers won't cover events which occur if your home is
unoccupied for more than 60 days. Also, some insurers insist you
have deadlocks on your doors and windows. If you don't meet the
requirements of your insurance policy, any claim you make may be
How to make a claim on your
If you need to make a claim, contact your insurer immediately.
You may be able to lodge your claim by phone, but some insurers ask
you to submit a claim form.
When you lodge a claim with your insurer:
- Be honest. Don't be tempted to add fictitious items to your
list of lost or damaged goods. If you get caught, there could be
serious legal implications.
- Provide as many details as possible about the incident.
- Provide all documents that support your claim, and keep a copy
for your own records.
- Cooperate with your insurer and the people they employ to help
assess the claim, such as investigators.
Paying out contents claims
Some insurers offer alternative ways to settle insurance content
claims. Insurers may:
- 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.
Choosing the right home and contents insurance
can give you peace of mind. By researching your options thoroughly,
you can protect your most precious possessions from loss or
Last updated: 08 Mar 2017