New home insurance

Home building insurance typically covers damage to the walls, roof and floors of your insured address, as well as the kitchen and bathroom fixtures and fittings.

Contents insurance can insure against the repair or replacement costs of the furniture, clothing, possessions and décor you bring into your new home. If your home is an apartment, townhouse or otherwise part of a larger building or complex, contents insurance may be the only policy you need to have.

A combined home and contents policy insures both the home building and your possessions inside it.

It depends on your insurer and the type of cover. The table below outlines some common items that are covered by home and contents insurance policies.

Home and contents insurance can cover your new home for loss or damage caused by a variety of insured events. The table below offers an overview of what’s typically covered by the different home insurance types.

Cover is subject to limits, sub-limits and exclusions. Always read the relevant Product Disclosure Statement (PDS) before you purchase a policy. The Target Market Determination (TMD) can also help you figure out if an insurance product is suitable for your circumstances.

Some common home and contents insurance exclusions may include damages from:

• General wear and tear
• Business activities (unless specified in your policy)
• Leaving your home vacant for an extended period without notifying your insurer
• Renovations or building extensions
• Home swapping
• Structural defects or faults
• Pets and animals
• Hydrostatic pressure
• Terrorism, nuclear contamination and acts of war
• Actions of the sea (e.g. king tides, storm surges)
• Landslide or subsidence (unless caused by an insured event)
• Mould
• Tree lopping or roots at your home
• Illegal activities and fraudulent acts.
• Deliberate actions.

Ensure you read the key facts sheet contained within your policy’s PDS so you understand exactly what’s included and excluded from your cover.

There are several factors to consider when deciding how much to insure your home for, including:

• Your home’s size, ground slope, design, features, materials and any permanent features like timber floors, patios and carports.
• Internal fittings and fixtures such as taps and faucets, kitchen cupboards, vanity units, light fittings, floor tiles and linoleum.
• Structural improvements, like in-ground swimming pools, awnings, pergolas, decks, fencing and tennis courts.

Your home insurance should be enough to completely repair or replace your home and its outbuildings. However, when calculating the value of your home, remember to exclude the land value.

When determining the value of your contents for insurance, think about how much it would cost to replace all your possessions and valuable items. These items may include:

• Clothing and footwear
• Appliances and furniture
• Electronics
• Rugs and curtains
• Crockery and valuables.

While your contents insurance will typically cover your belongings in your home, items you take outside your home (like mobile phones, laptops and wedding rings) may need portable contents cover. This is typically offered as an optional extra, which you can add to your standard contents insurance policy for an extra cost.

Sum insured cover reimburses you for losses or damages up to a set limit nominated by you (i.e. your sum insured). Total replacement cover provides financial protection to restore your home to its original condition before the event that caused the damage.

Underinsurance is when you don’t have enough insurance coverage to fully pay for the cost of repairing, replacing or rebuilding your insured home and contents. This can happen if you set the sum insured too low or you haven’t updated your policy in a while.

If you’re underinsured, your claim payout could be insufficient to compensate for the expenses needed for a rebuild, meaning you might have to foot the remainder of the bill.

The cost of home and contents insurance for your new home will depend on your insurer and level of cover, as well as factors unique to you like:

• The sum insured of your home and belongings
• The age, structure and building materials of your home
• The age of the policyholder
• Your claims history
• The location of the home
• Your home’s security features
• If you add optional cover to the policy (e.g. accidental damage or personal effects cover)
• The policy excess
• Government charges, taxes or levies relating to your policy.

If you want to get a better idea of how much it might cost to insure your home and contents, you can compare quotes from a range of insurers with our free comparison tool.

Yes, you can generally choose to pay your insurance premiums for your new home in fortnightly or monthly instalments. Keep in mind that paying premiums in instalments may cost more than an annual payment in the long run since they’ll be subject to processing fees.

The construction company should have insurance for the work they undertake while the home is being built. This should include insurance for builders and sub-contractors to cover damages if something goes wrong during construction.

Once your home is built, you can purchase home and contents insurance for your new home before you move in.

Investment homes can be covered by landlord insurance. This cover is similar to regular home insurance but includes benefits specific to landlords, such as theft and malicious damages by tenants and their guests.

You can also purchase contents cover if you have removable furnishings in your investment home.

As a strata resident, you’ll typically only need to get contents insurance to cover your belongings, whether you own the property or rent it. Strata property owners typically pay body corporate fees, which usually go towards insurance to cover the physical structure of the whole complex, plus the common areas.

You may be able to get building cover for a strata property if you live in a standalone home (e.g. a villa).

To secure your home loan, some lenders may require you to take out a policy to cover the property you’re buying. Should your new home be damaged or destroyed, having cover for repair or rebuild costs could prevent a significant financial loss to both you and your lender.