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Home insurance protects one of your most important assets.
What is home building insurance
Home building insurance (home insurance) covers the cost of repairing or replacing your house when something goes wrong. It covers the building itself and the fixtures, for example, plumbing and built-in cabinetry. It usually also covers other structures on your property, like a garage or inground pool, and can cover legal costs if someone is injured on your property.
It doesn’t cover your household items and personal belongings – they’re covered by contents insurance. You can often buy home and contents insurance as a bundle, if you want to.
You might not need home insurance if:
You own an apartment or unit under a strata title. Check with the body corporate to see if you need home insurance. The body corporate may be responsible for insuring the building. You’ll still be responsible for insuring your household items and personal belongings through contents insurance.
You’re renting. In this case you don’t need home insurance, it’s the landlord’s responsibility. But you may still choose to get contents insurance.
How much home building insurance do you need?
It’s important to cover the full cost of rebuilding your house so that you're not underinsured. This can include extras like landscaping, rubbish removal and solar panels. Temporary accommodation is usually paid in addition to your repair costs and benefits are typically limited to a percentage of your sum insured or a specific time period.
Use a home insurance calculator to work out your rebuilding costs - most insurers offer these. It’s helpful to use a calculator that asks lots of details about your home. This may include if it's built on a slope and age of the home.
You can try the calculators on the Insurance Council of Australia website, to get an idea of the amount of insurance you might need.
If you haven’t reviewed your insurance for 12 months or more, it’s easy to become underinsured. Learn more about underinsurance and how to avoid it.
What to check in a home insurance policy
When you’re comparing home insurance check the policy details carefully. Focus on what you need, and what is (and isn't) covered by different policies.
The cheapest policy may not give you the cover you need.
It’s good to ask these questions:
What parts of your property are covered?
- Check how the insurer defines ‘home’ or ‘building’ so that you’re not caught out. For example, an inground pool might be covered, but an above ground pool might not. A granny flat might usually be covered but may not be if you’re renting it out.
What events are covered?
- The insurer will give you a summary of what insured events are covered by the insurance. This will be things like flood, storm, theft, fire, lightning, earthquake, and malicious damage. There are many other events that may be covered.
- To find out if your home is in a natural disaster-prone area, there may be information provided by your state or local council. Check their websites for information about flood mapping, historical flood records, cyclone risk and the Bushfire Attack Level (BAL) of your home.
What extra things are covered?
- Some policies include extra benefits as part of the cover. These may include removal of debris, temporary accommodation for you and your pets, emergency storage of contents, and damage to plants.
What other optional extras can you add?
- Some insurers let you add extra cover for extra cost. This might include things like accidental damage and motor burnout cover.
What things are not covered?
- It’s important to understand what the policy does not cover. These are called exclusions. To find out what isn’t included, you may need to read the product disclosure statement (PDS).
- Examples may include damage caused by the sea, smoke, landslides or power failures. Even if flood is included, damage to some parts of your house may not be covered. See storm, flood and fire insurance.
How to compare home insurance policies
Insurers must provide a Key Fact Sheet for their policies. This can help you compare policies more easily because the information and layout are set by the government.
To understand the detail of what’s covered in a policy you can download the PDS.
Comparison websites can be useful, but they are businesses and may make money through promoted links. They may not cover all your options. See what to keep in mind when using comparison websites.
When comparing policies, check:
Premium - The premium is the cost of the policy. Compare the price for the same type and level of cover.
Excess - The excess is the amount you need to pay if you make a claim. Check how much this is and whether increasing your excess could reduce your premium.
Exclusions - Check what events, items or types of damage are not covered. Also check for caps, limits or special conditions.
Legal liability cover - Check whether the policy covers injury to other people or damage to their property at your home.
Extended cover - Check whether the policy includes extra cover above your sum insured. This may help if rebuilding costs are higher than expected after a total loss.
Cover limits - Check the maximum amount you can claim for certain items, events or benefits.
If you live in North Queensland, visit the Australian Government's North Queensland home insurance website. This site helps you compare home insurance policies based on where you live.
Review your home insurance each year
When it's time to renew your policy, don’t just accept the renewal notice. Check whether your cover still suits your needs.
Before you renew, check:
check_box your sum insured is still enough – does it reflect the impacts of inflation?
check_box your sum insured reflects any changes you’ve made to the property
check_box your excess is still affordable – you may want to see what difference it makes to your insurance premiums if you adjust it up or down
check_box your policy covers the risks that matter to you
check_box whether other insurers offer better value
check_box whether any exclusions or limits have changed
Home insurance protects one of your most important assets. It's worth taking time to check that the cover you have is right for you.
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