Does your home insurance cover erratic Aussie weather?

By Remy Taylor ·

When it comes to natural disasters, no matter how prepared you feel, the damage is inevitable. And with a new report by the Sigma revealing Aussie’s are ‘heavily exposed’ to secondary natural perils, such as bush fires and flash floods, it’s crucial to find out whether your home insurance policy will cover natural disasters. 

To help you understand secondary perils, whether your home is disaster-proof, and if you have enough insurance to cover different natural disasters, we’ve has rounded up all you should know:

Secondary perils in Australia

According to the Sigma study, insured losses due to secondary perils accounted for more than 60% of the $106 billion spent on natural catastrophe claims last year.

Swiss Re Head of Property Treaty, David Sinai said secondary perils in Australia are “typically weather-related”, claiming climate change might have an impact in the future. 

“As our world warms, we will experience increased atmospheric energy – more storms; a warmer atmosphere, which can absorb more moisture, leading to more intense rainfall events; and more heatwaves driving an increase in bushfire losses,” he said.

Does your home and contents insurance cover natural disasters?

Before anything, it’s important to find out if you live in a disaster-prone area so that you know the likelihood of flood or bushfires damaging your home. You can do this by getting in contact with your insurer, local council or state emergency service.

And in the case that you do find yourself living in a disaster-prone area, you should fine comb your insurance policy to make sure you’re financially secured in the best possible way, as some policies won’t cover for things like floods, bushfires and storms. 

What insurance should you have in place for these natural disasters?

Last December, insurers forked out a near $1.2 billion due to hailstorms in Sydney and before that there’s been heatwaves, droughts and floods a number of times in the past decade, so it may come as a surprise that some Aussie’s affected by these didn’t even have enough insurance cover on their home and contents.

To make sure your home isn’t underinsured, total the costs of rebuilding your home and replacing your contents in the events of a natural disaster and that’s how much home and contents insurance you should have in place.

If it’s been a while since you looked at your home and contents policy, check out our home and insurance guide. 

And if you still don’t feel like you’re secured enough, then you can always go on a hunt for a home and contents insurance policy with more cover, who knows, you might even find one for a lower cost.

Home and contents insurance policies - page last updated September 19, 2020

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