Australia’s Best Home Insurance for November 2024

Home insurance is a fantastic way to protect yourself financially in case of accidental or malicious damage, loss, or theft to your property and/or belongings. While it isn’t compulsory to have a policy in place, some mortgage lenders might require you to have one to lessen your perceived risk as a borrower.

What home insurance covers will vary from policy to policy. Generally though, home building insurance provides cover for your actual property, while contents insurance is designed to protect the belongings inside it. These can be purchased together or separately.

Home insurance often covers events such as fire, theft, storms, flooding, lightning, earthquakes, and malicious damage – although not every policy will provide insurance for all these events. Some may only offer cover for certain things, or including events such as flood damage as an optional extra. Carefully review the product disclosure statement (PDS) before purchasing, as this will tell you exactly what is and what is not covered with a specific insurance plan.

While there’s nothing wrong with searching for cheaper cover, it is worth remembering that insurance is designed to provide financial support should something go awry. If a policy doesn’t provide adequate cover, you could be left severely out of pocket in the event of a natural disaster or emergency.

That said, there are a few ways you can try to lower your annual premium. One of the best ways to save on home insurance is to make sure you get all the discounts you can. For instance, a number of providers offer a discount for combining home and contents insurance. This is called a multi-policy discount – you may even be able to get more money off by getting car insurance from the same provider, as well. 

Other things that could make your insurance cheaper include opting for a higher excess or adding extra safety features to your home. Keep in mind that a higher excess means you will have to pay more come claim time, so adding extra safety features, such as security locks or cameras, could reduce the chance of you being burgled. Ergo: make it less likely you will have to make a claim.

Generally speaking, the amount you insure your home for should be enough to pay for a full rebuild, should it be completely destroyed. That said, obtaining an accurate estimate for the cost to rebuild can be tricky. So as to not put all your eggs in one basket, you might think about getting an estimate from a few different sources. That way you can cross reference what you find and see if the results differ wildly.

CoreLogic has a Rebuild Cost Calculator designed to help estimate how much insurance a specific property might need. Home valuation experts are another option. You can use the Australian Property Institute’s “find a property professional” search tool to find a certified residential property valuation expert near you. Alternatively, a quick internet search may also bring up valuation experts in your area.

Underinsurance is when a property is insured for less than it would actually cost to rebuild it. So for example, if a property is insured for $400,000, but it turns out that the rebuild costs are actually over $500,000 - the homeowner is going to be left out of pocket. Unless the insurance customer has an underinsurance safety net with their policy, the insurance company will not pay more than $400,000 towards the rebuild costs.

Check out Mozo’s guide to underinsurance to read more about what it is and how you can avoid your home being underinsured.

If you don’t have home insurance, any repairs your property needs will have to be paid for with your own money. The main point of home insurance is to provide financial support to individuals in the unfortunate event that their home is damaged or made uninhabitable. Costs stack up fast – especially in the event of a flood or bushfire. 

In worst case scenarios, some homes even need complete rebuilding after an extreme weather event. In these instances, bills for construction work can climb over $100,000. Not many individuals will have that much money stashed away in a savings fund. Of course even with home insurance, there will often still be at least a small amount to pay (such as an excess). However, home insurance can help you recover without taking as big a hit to your finances.

The excess is the amount you will be expected to pay before the insurance company steps in. For example, say someone has a $400 excess with their home insurance. The insurance company will most likely not contribute towards a $300 bill, but will help out with a $1,000 bill (if the claim is accepted, of course). In the second scenario, the customer would pay $400 and the insurance company would pay $600. 

What your excess is will depend on a number of factors. These include the policy you sign up to and whether or not the insurance company allows flexibility in choosing an excess. A high excess will usually equal a lower insurance premium, while a low excess will often lead to a more expensive premium. 

However, come claim time you will have to pay more with a high excess and less with a low excess. So depending on the likelihood of you having to file a claim, there are different advantages to having a higher or lower excess.

No one home insurance policy can be called the best. However, some may be more suited to your circumstances than others. As discussed earlier on, a policy that includes flood cover as standard may be appealing to someone who lives in a valley or near a river, while someone whose home sits near bushland may be more concerned about bushfire cover.

To pick the best home insurance for you, you will first have to decide what you need from a policy. Are you worried about your home being burgled? Do extreme weather events pose a threat where you live? Another thing to consider is budget. If money is tight, you may be after a no fuss policy that covers the basics. Or, if your financial situation is comfortable, you may want a comprehensive home insurance plan with all the bells and whistles attached.

Whatever your situation, you can start reviewing policies at Mozo’s compare home insurance hub. Here, we give a snapshot of individual home insurance policies available in Australia right now.

While there’s no official requirement for homes to be insured in Australia, many mortgage lenders may require you to have a home insurance policy in place before approving your home loan. This is because depending on the policy, home insurance (whether building, contents, or combined building & contents) could offer significant financial protection from unforeseen circumstances. Even if it’s not federally mandated, it’s still a worthwhile investment to consider.