Protecting your home and contents

Australia has often been called ‘the lucky country’, however we are not immune to the forces of nature. Fires, floods and cyclones are just some of the natural phenomena that can impact our lives and property.  Here we explain briefly how building, contents and landlord insurance can help.

Building and contents insurance can protect you against financial loss, but it’s important to have the right amount and type of cover. If you underinsure to save money, or because you haven’t kept insured values up to date, you won’t be fully covered if something goes wrong. If you over insure, you may be paying higher premiums than you need to.

Sometimes following a natural disaster or significant weather event, it can be harder to obtain building or contents insurance. You may have to contact several insurers to find one that will offer you suitable cover. Serving ADF members may find the Defence Service Homes Insurance Scheme can offer suitable cover.

Get the right cover. Building and contents insurance, while often bundled together for homeowners, are actually separate policies, and if you own an investment property, you should consider taking out landlord insurance.

Building insurance

Building insurance protects you against things that are out of your control, such as damage from storms, floods and bushfires. It covers the cost of replacing or repairing your home, including fixtures such as lights and built in appliances.

Typically you have a choice of:

• Total replacement – which covers all the costs to rebuild your home to the standard it was prior to an insured event.
• Sum-insured – which covers you up to a set amount.

There are variations to these two basic models, so read the fine print and ask questions if there’s anything you don’t understand.

If your property is under strata title, for example an apartment or townhouse, building insurance is usually organised by the strata manager and paid for as part of your strata fees. Check with the strata manager that adequate building insurance is maintained.

Contents insurance

Contents insurance covers the cost of replacing or repairing the possessions you keep inside your home, such as furniture, clothes, appliances, tools and jewellery. It also covers fittings such as curtains, blinds, carpets and lights.

If you are renting or in service accommodation, it’s still a good idea to take out a contents insurance policy to cover you for loss of or damage to your belongings.

Be aware that most insurers will require you to list collections and other valuables separately if you want them to be covered under the policy. If in doubt, ask your insurer when you are arranging cover.

Landlord insurance

If you have an investment property, landlord insurance may include cover for:

• Building – similar to standard building insurance.
• Contents – for things like curtains, blinds, light fittings and carpets, not covered by building insurance.
• Loss or damage caused by your tenants.
• Loss of rent as a result of some tenant actions.

As with all insurance policies, cover may differ between insurers so read the fine print to be clear on exactly what is and isn’t covered.

You’ll find more information in our insurance money guide.