Home & Contents Insurance Tips and Traps

Whether you’ve built it from scratch or picked it up at an auction, our home is the most expensive thing we own. So the last thing you want is to find out you’ve forgotten to add or misjudged something on your home and contents insurance policy, like underinsurance.  

That’s why we’ve pulled together this guide to make sure you’re understand all the ins and outs of home insurance, so you’re not left out of pocket. Check it out.

• Read through your policy product disclosure statement (PDS) with care. It will take hours out of your life you’ll never get back, but it’s well worth it to understand exactly what you're covered for and what's excluded from your policy.
• Regularly reassess your level of cover. Make sure this takes into account any changes you have made to your property, like renovations or pool installations. 
• Avoid automatically renewing your policy. Get a few quotes (including one from your current insurance provider) and ask them to match the deal they offer for new customers, or find a better offer and make the switch. 
• Check what may not be covered by your home insurance. And then check for optional extras – sometimes you can get extra cover for an additional amount.
• Keep good records. You can do this by taking photos and compiling an inventory of your home’s contents and store it somewhere safe, so you can give them to an insurance assessor if you ever have to make a claim. 
• Think twice before you make a claim. Insurance claims, big or small, all affect your future insurance quotes as it increases your risk profile.

• Many insurance providers won't cover events which occur if your home is unoccupied for more than 60 days. Be sure to tell your provider if your home will be left unoccupied for an extended time and figure out an agreed solution. 
• Not all contents insurance providers cover you when you’re moving house. Some will, but only in certain situations, for example, if they’re damaged in a car accident.
• Contents that's kept outdoors may not be covered to the same level as indoors items. 
• Watch out for water damage. This is a really problematic area of fine print for home and contents insurance. Premiums are very expensive for flood-prone areas as insurance providers often know more than you do about the risks to your intended home. Check with the local council to see if flood maps are available. Leaky roofs are a common cause for claims-denial, so make sure your property is properly maintained.
• Home insurance policies won’t always cover business activities and assets. If you work from home or store work-related equipment or inventory at home, you may need a separate business insurance policy.
• Underinsurance can hit your wallet hard. This is the industry term used to describe when your home isn't insured for its full value. For example, if it would cost $500,000 to rebuild your house, but you've only insured it for $400,000, or 80% of its value, then the insurance company can apply averaging to any partial claim. This means if your $10,000 shed burns down, your claim will be 'averaged' at 80%, and your payout will only be $8,000 – leaving you to pay the rest of the cost of rebuilding it.

Ready to find the policy that’s right for your home? Check out our home insurance comparison page to see what’s on offer.