Explore Home & Contents Insurance

What is renters insurance?

Renters insurance is a term for contents-only insurance for renters which offers a financial safety net against specific events, such as theft of, or unforeseen damages to, your belongings and valuable items. Some possessions that you can cover with contents insurance include furnishings, clothing, jewellery, portable items such as mobile phones and home electronics like laptops. If you’re renting, you don’t need to worry about home building insurance, as this is the responsibility of the landlord.

Without contents-only insurance cover, you’ll have to foot the costs associated with repairs, accidental loss or replacing your belongings should anything happen to them.

This type of cover is specifically designed for people who are renting, which is a big chunk of Aussies.

Find out more about the ins and outs of contents-only insurance, commonly referred to as renters insurance, how an insurance quote can help and how much cover may cost you through our comparison service.

Why is renters insurance important?

Contents insurance for renters is important because while your home building may be protected by your landlord’s insurance, your belongings are not.

If your possessions are damaged or stolen and you don’t have contents-only insurance, it could cost you tens of thousands of dollars to replace your possessions. This might sound excessive, however, the ABS reported the mean value of property assets value of Australian dwellings at $731,100 in 2020.1

So, when was the last time you took stock of all your belongings?

It’s easy to underestimate the value of the household belongings you have and therefore underinsure your contents. But would you be prepared to pay for the damages caused by a fire, flood, storm or other emergency?

In 2021, the Insurance Council of Australia, (ICA) stated that 23% of Australians didn’t have insurance, or enough insurance, to cover the cost of replacing their home or household possessions.2

When taking out a renters insurance policy, which is contents-only insurance for renters, you need to make sure the sum you’re insured for is enough to replace all of your contents.

Frequently asked questions

How much does renters insurance cost?

The factors listed below may impact your contents-only insurance policy:

  • Whether your suburb falls in the flood/bushfire risk zone. Many Australian homes are vulnerable to a range of potential natural hazards such as floods, bushfires, cyclones, storm surges and erosions (including sinkholes). If you’re renting in a hazard-prone area, it will reflect on your insurance policy.
  • Your suburb’s crime rate. While the area you’re renting in might appear safe and quiet on the outside, the statistics might offer a different story. The higher the crime rate, the more your insurance policy will likely cost.
  • The actual cash value of your belongings versus replacement costs. This can sometimes be tricky to work out. Typically, the value of your possessions decreases with time while the price of replacement items grows. It’s therefore crucial that you calculate your replacement costs as precisely as you can.

When you’re renting a house or unit or living in shared accommodation, fire damage or theft of your valuables are some of the biggest risks you can potentially face. These risks can leave you unable to recoup total losses, without some items for a period of time or having to borrow from family and friends. Therefore, you need to take inventory of your belongings inside the rental property to get their replacement value as accurate as possible. This involves the following steps:

  • Documenting everything that you own for insurance purposes; and
  • Keeping the receipts and taking photos of items to make sure there’s ample evidence that you’ve owned them in the first place.

The cost of contents-only insurance for renters varies across policies, providers and customers. This is because not every policy provides the same coverage, and not everyone’s belongings are worth the same amount.

The following prices are indicative only and may not be an accurate representation of what your individual premium could be. If you’d like a more personalised quote, head over to our home and contents insurance comparison service for your free quote.

The average cost of contents replacement is based on content replacement costs (rounded to the nearest whole number) that customers entered into Compare the Market’s home and contents insurance comparison service in financial year 2020-2021.

State/TerritoryAverage Cost of contents replacementAverage Indicative Annual Premium*
New South Wales$ 59, 142$ 465
Victoria$ 53, 915$ 495
Queensland$ 55, 685$ 444
South Australia$ 52, 695$ 417
Western Australia$ 52, 500$ 429
Tasmania$ 64, 082$ 329
Australian Capital Territory$ 59, 778$332

*Indicative, annual premium based on the average of quotes provided by Compare the Market’s home and contents insurance comparison service as of October 2021. These quotes are for a tenant of a freestanding house built between 1980 and 1989 with weatherboard walls, COLORBOND® roofing and no security alarm, located in capital city postcodes: 2000 (Sydney, NSW), 3000 (Melbourne, VIC), 4000 (Brisbane, QLD), 5000 (Adelaide, SA), 6000 (Perth, WA), 7000 (Hobart, TAS) and 2600 (Yarralumla, Canberra ACT). These residences were not used for business purposes, policy holders at these residences didn’t take extra cover for specified contents above policy limits, they didn’t cover personal effects taken away from home, had no thefts or burglaries in the last five years, were not retired and paid an excess of $500.

Specific costs can be hard to determine, as they will vary depending on your situation. When you take out a contents-only policy, the cost of your insurance may be affected by a range of factors, such as:

  • The amount or sum you’re insured for;
  • History of claims, thefts or burglaries at the address;
  • If your home is used for business purposes;
  • Your suburb’s crime rate and median rent price;
  • Your home security;
  • Age and structure of your home;
  • Building and roof material
  • Risk of natural hazards (e.g. the likeliness of your home flooding); and
  • Whether you wish to cover items you take outside the home (personal effects insurance).
  • The age of the tenants
  • The excess you choose

What does contents-only insurance cover?

Coverage does differ between contents-only insurance policies and providers; you may be covered for a certain event under one policy, but not under another. However, some things that are generally covered under renters insurance include:

All contents-only insurance policies might offer greater levels of cover, including:

  • Explosions. If your rental property has gas, or you’ve brought a gas appliance with you, cover for explosions could be something to consider.
  • Water damage. Severe contents damage can stem from something as trivial as an overflowing bathtub, sink, toilet or a leaky washing machine or dishwasher. It could also come from heavy rain runoff and storms.
  • Vandalism. While vandals may seem more likely target the exterior of your home, they may also damage your belongings. This can include outdoor furniture, gardening equipment and bicycles.
  • Natural disasters. Many residential areas are vulnerable to bushfires and floods, while some seaside suburbs are prone to the risk of erosion. Most policies will include tsunami or earthquake cover, but flood cover may cost extra.
  • Moving house. Contents-only insurance can cover your items and furniture while they’re in transit, though additional exclusions, terms and conditions may apply.

If you’re after additional cover, you can also add optional extras to your insurance to cover:

  • Accidental damage.Contents-Only insurance can include cover for accidental damage to glass and ceramic fixtures, like basins and glass cooktops.
  • Jewellery. Family heirlooms are often our most treasured possessions. If you own anything valuable that would be difficult to replace, it’s worth getting them covered.
  • Clothing and accessories. Consider the cost of replacing your entire wardrobe if the house was lost in a fire. Even if you don’t ‘dress to the nines’ every day, it could be an expensive proposition.
  • As a renter, you may not have much in the way of furniture – but your bed, wardrobe and any big-ticket items may still be worth insuring.
  • Electronics (e.g. laptops, televisions). Electronics can be easily broken in a disaster, and they’re a desirable target for thieves. Not to mention the risk of power surges irreparably damaging your devices. While you can watch Netflix on your phone, chances are you’ll miss your TV if it’s stolen or damaged, so it’s best to insure those kinds of items if you can!
  • Appliances (i.e. white goods).If you rely on your washing and drying machine, fridge and dishwasher, you might want to check if white goods and motor burnout cover is available through your policy or as an optional extra.
  • Your music/movie collection. If you have a record or film collection, you’ll probably be aware of rare titles being targeted by profit-savvy thieves. However, even if all you own are ten-year-old Seinfeld DVD’s, it could be worth making sure you can replace them.
  • From framed photographs to prints and paintings, artworks can hold significant sentimental value, not to mention enormous monetary value. Depending on the value of the item, coverage for artworks may cost extra.

You’ll also need to be mindful that any items taken out of the home need to be insured as personal effects.

Contents-Only insurance can also cover you from legal liability, should your belongings cause a visitor to injure themselves or damage their possessions at your place accidentally.

By using our free home and contents insurance comparison service, you’ll be able to see what’s covered under each available policy when comparing results. Be sure to read the Product Disclosure Statement (PDS) of a policy to see exactly what’s listed though, as coverage and exclusions can differ between insurance providers.

See below to find out about any exclusions you might face with Contents-Only insurance for renters.

What does contents-only insurance not cover?

As with any insurance product, you should consider exclusions when considering getting contents-only insurance cover. For example, contents-only insurance for renters will not cover:

  • Breaking the law. Any damage or loss caused by illegal activity in a rental will not be covered by Contents-Only insurance. This includes drone operations, firearm offences or assault.
  • Unattended or unsecured contents. If you leave your personal and valuable effects out in the open air or in a common area, any loss or damage to them will not be covered.
  • Vermin. Destruction caused by vermin will not be covered by contents-only insurance
  • When the home is unoccupied. If you leave your home unoccupied without notifying your insurance provider of your extended period of leave or haven’t complied with any conditions that may be part of your insurance contract, you will not be covered.
  • Mechanical or electrical breakdown. Unless you have extra cover for your mechanical or electrical goods, or face a power surge or other damage by a lightning strike at your property, any breakdowns or damage not already covered by a specified event (e.g. power surge) won’t be covered by Contents-Only insurance.

 

What is a tenant responsible for?

When the dog chews up the carpet or a clumsy kid knocks a hole in the wall, it’s the renter who is responsible for the accidental damage to the rental property. Any damage that’s caused by the tenant or their guests falls to the tenant to repair.

Damage that happens over time, like cracks in the wall or other types of wear and tear, is the responsibility of the property’s owner to fix, as it’s their duty to ensure their property is fit for someone to live in. If you’re worried about having to prove whether damage is due to wear and tear, documenting it through photos and videos can help your case.

If you’re the one who is responsible for accidental damage to the rental property, you may be required to arrange and pay for the repairs yourself.

What do I need to remember before buying contents-only insurance?

There are two main things you should consider before buying a contents-only insurance policy for renters:

  • Whether you just want to insure your possessions that stay within the rental property; and
  • Whether you also want to insure personal effects – or possessions you regularly take out of the house (e.g. your pushbike, handbag, laptop or tablet).

Rather than just assume that your insurance policy offers automatic protection for your contents and any breakages, it’s better to have all bases covered by taking into consideration the following before choosing a suitable policy.

  • Consider adding valuables to your policy. You might need to specify belongings with high replacement cost on your policy, such as jewellery, artworks and designer furniture, or insure them separately. Bear in mind, though, that this will most likely affect the cost of your renters insurance, increasing your monthly premium.
  • Calculate the costs. You will need to determine your possessions’ monetary value. There’s a range of handy online calculators available to help you with this task. Once you’ve worked out the numbers, you can compare contents insurance policies to determine which one accommodates your needs.
  • Your postcode matters. For example, when you’ve moved to a new area, you might not initially realise that your house could be in a danger zone. Generally, if you rent in an area with a higher crime rate, you pay more premium than residents of ‘safer’ suburbs. The amount you pay in premiums may likewise depend on the replacement value of your insured belongings.
  • Consider insuring white goods. Chances are you will be bringing your household appliances into your rental accommodation. This is why you might also want to consider looking into insuring your washing machine, fridge or portable heater. For this purpose, you can choose a motor burnout insurance policy and ensure your electrical goods run without a hitch.

How does a renters insurance payout work?

If you make a claim on your contents-only insurance for a damaged, stolen or lost item, one option your provider may choose could be to replace your item with the same or a similar model.

However, if your provider doesn’t replace your valuables with a suitable alternative, they might settle your claim by:

  • Fixing the items through their repairers;
  • Paying you for the cost to replace or repair the items;
  • Providing a cash settlement;
  • Offering you a gift card; or

If you’d prefer a replacement as opposed to a payout, it’s a good idea to check that your contents insurance includes a new-for-old replacement benefit. Check your PDS to determine if your contents will be replaced with new items.

Who provides renters insurance in Australia?

If you’re looking to compare renters insurance providers in Australia, Compare the Market’s home and contents insurance comparison service can help you do just that. While we don’t compare every provider in the market, our service can select policies for your comparison based on your details in just minutes.

Stephen Zeller, General Manager

Meet our home and contents expert, Stephen Zeller

As the General Manager of General Insurance, Stephen Zeller wants consumers to be well equipped with the understanding of their insurance coverage and to use the power of comparison to save money. While a renter’s home is often protected by the landlord’s insurance, adequate renter’s insurance can financially protect your belongings against accidents, break-ins and other damage.

Stephen has more than 30 years of experience in the financial services industry. He is an Allied member of the Australian and New Zealand Institute of Insurance and Finance (ANZIIF) and ensures any information about insurance products that we publish is accurate and comprehensive.

Top Tips from our renters insurance experts

  1. Choosing a higher excess could reduce your premium.
  2. Making sure your landlord takes care of the property (security and roof condition) could prevent theft and storm claims.

Sources

1 Australian Bureau of Statistics – Household financial resources
2 Department of Veteran Affairs – Is your home at risk of underinsurance?

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