Home and Contents Insurance in Australia

Home and contents insurance in Australia has a few genuinely different concepts from what you might expect, especially around how the building itself gets covered and what a body corporate does and doesn't insure.

Sum insured vs total replacement

Australian home insurers generally offer two different models. Sum-insured cover — the more common of the two — pays out up to a set amount you nominate, based on what it would cost to rebuild. Total replacement cover instead promises to rebuild your home to its previous standard regardless of the final cost, with no fixed cap. Total replacement sounds safer, but it's not offered by every insurer or for every property type, and it usually costs more — worth asking directly which model you're being sold, since the two behave very differently after a genuine total loss.

If you own an apartment or unit: strata doesn't cover your stuff

If you're in a strata scheme, your body corporate already insures the building itself through strata insurance — but that cover stops at the building's fixtures. It specifically excludes things like carpets, curtains, blinds, and any appliances not actually wired into the property. Your own belongings, and often internal fixtures you've added yourself, need to be covered by your own contents insurance — this is a genuinely common point of confusion for first-time apartment owners, since it's easy to assume the body corporate's premium already covers everything inside your own walls.

Sum insured, not automatic replacement, for contents

Contents insurance is a separate decision from your sum-insured figure for the building: new-for-old cover replaces items regardless of age or wear, while indemnity cover only pays what the item was worth at the time, after depreciation. Confirm which you're being sold, since the difference matters a lot at claim time.

Flood and bushfire risk affects pricing directly

Unlike some countries where natural disaster cover is a flat, government-backed scheme, Australian home insurance premiums are priced individually against your property's actual bushfire and flood risk — a real and sometimes significant factor in areas with known exposure. If you're moving to a bushfire-prone or flood-prone area, get a quote before you commit to the property, not after, since premiums (and in some cases availability of cover at all) can vary a lot by address.

Building your claim evidence into the move itself, not after

Most people only think about proving what they owned once something's already gone wrong — but moving day is the one point where you're handling everything anyway, which makes it the cheapest possible time to build a real record. Video a slow walkthrough of each room's contents as you pack, not just photos of individual items, since a moving-day video also happens to double as proof of the property's condition on the day you took occupancy, useful if a dispute about pre-existing damage ever comes up. Keep receipts for anything you buy to replace items lost or damaged in transit, and store the video somewhere other than on a device that's also being moved.

Before you move in

1. Confirm your new cover starts on settlement or move-in day, not whenever you get around to calling.
2. Work out your sum insured from rebuild cost, not purchase price — in a fast-moving property market these can be very different figures.
3. Buying into a strata scheme? Check exactly what the body corporate's insurance covers before assuming your own contents policy needs are lighter than they are.
4. In a bushfire- or flood-exposed area, get an insurance quote before signing anything — pricing (and sometimes availability of cover at all) can vary a lot by address, and this is far easier to factor in before you've committed than after.
5. Get quotes from more than one insurer — a comparison service like Compare the Market shows a range side by side, though it's worth knowing comparison sites don't always list every major insurer.

Common mistakes

• Assuming strata insurance extends to your own belongings inside the unit — it doesn't.
• Using the purchase price instead of rebuild cost when setting the sum insured, which under-insures the building.
• Signing on a property in a known bushfire or flood zone before finding out what that does to the premium.

This guide is general information, not advice on your specific situation — an insurance adviser or your insurer directly can confirm what's right for your circumstances.