How to make a home insurance claim

Home is where the heart is, so it’s important to keep it safe and secure with home insurance. When the worst happens, such as fire, theft, or vandalism, it’s time for your coverage to shine. But how exactly do you go about making a home insurance claim?

Let’s go through the overall process, step by step.

Home insurance covers accidental or malicious damage, theft, or loss to your property. Building insurance covers physical structures such as your house whereas contents insurance covers your belongings. 

Most homeowners will opt for a combined building and contents insurance policy to maximise their coverage. There are also policies specifically for landlords looking to insure their investment properties, as well as renters looking to protect their belongings.

Like any insurance policy, the product disclosure statement (PDS) will tell you how the product works, including any and all inclusions, exclusions, and other obligations you may need to meet to get your coverage. Before purchasing any home insurance policy, always read the PDS so you’re not stung with nasty surprises down the track.

RELATED: Ten places in Australia that'll be uninsurable in ten years

Providers will also sometimes give you the option to tailor your coverage by adding optional extras to your policy, usually for a bigger premium. For instance, if you have a rare collection of potted Mexican cacti in your living room, you might opt-in for increased valuables coverage to raise the sub-limit in case your cacti get destroyed or stolen (and yes, plants can sometimes get coverage).

There are some major things home insurance doesn’t cover, however, and any claims on excluded events will likely be rejected by the provider. Some common exclusions include:

• Damage arising from poor maintenance, such as mould, termites, or leaky pipes.
  
• Pre-existing damage. 
  
• Incidents that don’t fit the provider’s definitions. This is especially important for smoke-related bushfire damage or flooding from rainfall run-off as opposed to an overflowing river, as the provider’s definitions of a bushfire or flood could be intensely specific and only cover certain circumstances.

For more information, be sure to check out our guide on things you may not know about your home insurance policy. Basically, the idea is to go for value and not price, as you want to be adequately covered and avoid underinsurance as much as possible.

Your provider will always have information available on how to file a claim either on their website or PDS, but here’s the overall process. 

• Report the incident to the authorities ASAP. As soon as it’s safe to do so, make sure you report the incident and get a copy of the report, especially if it’s a police report. This will give official authority to your claim.
  
• Contact your insurance provider. They will be able to walk you through the next steps, including what evidence you will need for your claim and whether they will send out a representative to assess the damage. In some cases, they may also be able to provide you with immediate assistance such as emergency accommodation, though this will depend on what’s included in your policy. 
  
• Collect and prepare evidence. You will need extensive documentation to support your claim. Evidence can include photographs, receipts, policy information, damage assessments from either the insurance provider or a private appraiser, written descriptions, etc.
  
• File your claim. Lodge your claim with your provider via online form, email, post, or fax. Keep in mind you may also have to pay an excess, which is a pre-agreed sum you pay whenever you make a claim on specific items or incidents.
  
• Follow up on the progress of your claim. Providers can sometimes take up to 10 days to process your claim, but they expedite the process under certain circumstances (providers famously put claims on turbo mode after this year’s flooding in NSW and Queensland). Make sure you follow up on the progress of your claim if you’re concerned about anything.
  
• Your provider will tell you what to do next. After assessing your claim, your provider will let you know whether your claim has been approved or denied. If successful, ask for a timeframe on when you can expect a pay out. If your claim has been rejected, follow up on the reasons why, get it in writing, and double-check the PDS. You can then complain to your provider’s Internal Dispute Resolution Department (IDR) to see if you can resolve your claim or seek advice from the Australian Financial Complaints Authority (AFCA).

Evidence for your home insurance claim will document what happened, when, how, and why you’re claiming the incident based on your policy’s inclusions. Different types of damage will usually need different types of supporting evidence.

Evidence can include:

• Police reports.
  
• Written description of the damage.
  
• Photographs.
  
• Receipts.
  
• Damage assessment reports from the provider or a private representative.
  
• Your policy’s information.
• Maps.
  
• News reports.
  
• Council reports or appraisals.
  
• Information on other properties, vehicles, or people affected by the insured incident.
  

Long story short, if it gives the provider an idea of what happened and how much reimbursement you should be eligible to receive, include it as evidence.

Usually your provider will give you up to 30 days after the incident occurred to file a claim. This gives you a chance to get to safety, contact your provider, collect evidence, and prepare and lodge a claim. Providers will then usually take up to 10 days to process your claim, though sometimes they can take a little shorter or longer. 

If your claim is successful, they will inform you of any payouts or reimbursements and when you can expect them. You will most likely receive a direct bank transfer from your provider, which can sometimes take a few days to process.

There are a few common reasons why home insurance claims get rejected, namely:

• Failure to disclose relevant information. This could be things like not telling your provider about any pre-existing damage or prior claims you’ve already filed. It’s important to be as upfront and truthful as possible to give your claim the best chance.
  
• Not reading the PDS or exclusions. Failure to understand what’s included or excluded in your policy is one of the most common reasons why claims get rejected. Be sure to read the PDS very carefully and consider which risks apply to your home, so you can find a policy that covers your situation appropriately.
  
• Fraudulent claims. If the provider believes you made a fraudulent claim, the burden of proof is on them to back up this serious allegation. If this is the case, it’s time to lawyer up.
  
• Waiting periods or failure to renew. Most policies will have certain limits on when coverage kicks in, especially for natural disasters (which typically ranges between 48-72 hours). If you only bought a policy when the flames were already on your doorstep, you likely won’t receive any coverage for the fire damage.

Whatever you do, just don’t make the same rookie mistakes as these five iconic movie characters.

Keen on some comprehensive cover? Browse and compare building & contents insurance policies below, or read up on the best home insurance providers.