Compare home insurance

‘Home insurance’ is often used as a blanket term to describe a range of different policies you can purchase for your home, but it’s also a standalone policy.

A home insurance policy is specifically for your home building and its fixtures, which is why it’s sometimes called building insurance. Personal items (like clothing, furniture and electrical appliances) are typically covered by contents insurance.

You can also combine home and contents insurance into one policy that covers both.

The following are the different types of home insurance policies that are available in Australia:

• Home insurance cover is specifically for the building that you live in, as well as other structures on your property like sheds, garages and outbuildings. This type of cover may also be known as ‘home building insurance’ or ‘building insurance’.
• Contents insurance covers the items in your home, which may include furniture, appliances and clothing. For an additional premium, it may also cover portable items like mobile phones, laptops and handbags.
• Combined home and contents insurance covers both your home and the items inside it against insured events.
• Landlord insurance covers the building and structures of your investment property. Depending on your policy, landlord insurance could also protect you against loss of rent, tenant default and legal action.
• Strata insurance is typically included in body corporate fees and provides home insurance cover for apartments and townhouses.

While having home insurance isn’t usually mandatory, there are several reasons why you might consider purchasing a policy, including:

• It provides a financial safety net. Home insurance could cover the cost if your home is damaged and needs to be repaired or rebuilt.
• Home insurance is often a requirement for a mortgage. Your lender may require you to get a Certificate of Insurance before your home loan is settled.
• Peace of mind. Having home insurance could give you a sense of security knowing you’re covered for things like storm damage, bushfires, vandalism, legal liability and temporary accommodation costs.

While cover can vary depending on your insurer, this table provides a guide to what’s generally included and excluded from home insurance.

Always check the relevant Product Disclosure Statement (PDS) for any insurance policy before you buy to see the full details of inclusions and exclusions. The Target Market Determination (TMD) may also help you figure out if the insurance product suits your circumstances.

Along with the standard inclusions offered in home insurance, your insurer may offer the following optional extras:

• Flood cover could help you with the cost of repairs or rebuilding if your home is damaged by floodwaters or needs to be fully replaced.
• Accidental damage cover could provide cover against accidental damages to your home which can happen as part of everyday life, including damage to walls and fixtures.
• Motor burnout cover can help pay for repairs and replacement costs for fixtures like washing machines and aircon units if their electric motors break due events like power surges or electric currents.

Note that adding optional cover will typically increase your home insurance premiums.

Home insurance only covers your home building, not the valuables in your home. You’ll need a contents insurance policy to cover these items. Some other common home insurance exclusions include:

• Business activities (including using your home as a holiday rental property)
• Existing damages
• General wear and tear
• Pet and animal damage
• Uninsured flood damage.

The cost of home insurance in Australia can vary based on a variety of factors, including:

• Your level of cover (i.e. the sum insured amount)
• The home’s location
• What materials the home is made of
• Your policy’s excess amount.

There are a few things you can do if you’re looking to make your home insurance cost less, including:

• Adding security features to your home. This can reduce loss or damage associated with theft, and therefore can entitle you to a slightly cheaper premium.
• Choosing a higher excess payment. This can reduce your premiums, but if you make an insurance claim, you’ll need to be able to afford to pay this higher excess amount.
• Buying online. Many insurers offer a small discount if you purchase a new policy online.
• Paying your insurance premium annually. A yearly payment will usually be cheaper than paying your premium in monthly instalments.
• Bundling your policies. If you need to purchase another type of insurance product (like car insurance or pet insurance), your current home insurance provider may give you a discount for multiple policies.

If your building is run by a body corporate, they’ll likely have a strata insurance policy in place, which covers the physical structure of the building. However, you might consider contents insurance to protect your possessions.

You typically can’t get a home insurance policy until the construction is complete. While the building is under construction, the builders’ insurance will pay for damages and incidents that occur. Be sure to inquire with the builder about their legal liability and insurance policy before you hire them.

Most home insurance policies provide a lifetime guarantee on the cost of repairs or new-for-old replacements if a new fixture is installed following an insurance claim.