Choosing home insurance: What do I actually need?

For many Australians, getting the right level of home insurance is just as important as health cover and car insurance. And, because the pandemic shifted many people to begin working from home and many of these people purchased extra equipment and furnishings, it could be said that it’s now even more important to check your cover to ensure that your home insurance is at the right level for your current needs.

Here are some things you need to know about buying home insurance – and what you can do to help ensure you get the right cover.

Has your home environment become more of a focus point?

Remote work might mean that home insurance is more “top of mind” than people considered previously, as many of us have spent a lot more time at home during the pandemic. As well as working, people spent more time in their homes doing activities like art, baking, puzzles and watching TV and movies. A comfortable home became something that more people might have focused on.

The COVID 19 pandemic has had – and will continue to have – a long-term impact on everyday Australians. Not only has it changed the way we live and work, but The Choosi Choices Report also found that it’s changed the way we make decisions.

It’s affecting how Australians make choices around having a healthy lifestyle (79%), prioritising health over career (76%) and putting family first (72%). It’s also made both employers and employees realise that there’s more than one approach to how work can be done – namely, that working from home has the potential to be just as collaborative and productive as working in an office.

But with a change to our work style can come the need to assess the level of cover we have to protect our home and belongings. Many people found they purchased more valuable equipment to work from home, such as ergonomic desks, wifi routers, headsets, noise cancelling headphones and laptops. As a result, many Australians have had to reconsider whether they have the right level of home and contents insurance to protect these items from damage or theft.

Work equipment: Something to factor into your insurance policy

Now is a great time to review your policy – or consider taking out home and contents insurance if you don’t already have it – to make sure your work equipment that is used at home is covered. You should always read your policy’s PDS, and contact your insurer if you have any questions.

How to choose home insurance

It is one idea to seek advice from a professional and weigh up your various options. As well as getting professional advice, another option is to do your own independent research on what policies may be available to purchase directly from the insurer. When you start looking around and comparing home insurance policies, you could take into consideration a number of factors. The first thing is understanding exactly how much it would cost to rebuild your house in the event of a disaster.

Make sure you work out the most accurate figure for your replacement insurance policy, as you don’t want to risk being underinsured. Majority direct insurers will have calculators on their websites to help you determine this amount, and many allow you to factor in things like the quality of fixtures and fittings in your home, whether the property is built on a slope, the year your home was built, as well as supplementary costs like removing debris from a worksite before rebuilding. Otherwise hiring a valuer can assist.

Before choosing a policy and an insurer, you will also want to check the cover provided and any exclusions – such as which events you aren’t covered for (e.g. landslides, power failure or smoke damage). Also check whether the policy allows you to adjust your excess. For example, you may wish to increase your excess to reduce your premium payments. Always make sure you read the PDS to ensure the product you are considering suits your needs.

The good news is that comparing home and contents insurance with Choosi makes things so easy for you. Simply enter your details and what you need insurance for, and we’ll show you a range of trusted insurers who may be able to meet your home and contents requirements.

6 things to compare

Rather than going with the first home and contents insurer you find, get quotes on different policies and then compare some key features, such as:

1. Premiums: the cost of owning the policy.
2. Excess: how much you will have to pay when you make a claim.
3. List of exclusions: excluded events and items that won’t pay out on your policy. Also check for limits, caps and other conditions.
4. Legal liability: the cover for any injuries to other people and their property at your home.
5. Cover limits: how much you can claim for certain items and outcomes.
6. Extended cover: whether you automatically have an amount of cover added to your sum-insured during a catastrophe to help reduce the risk of being underinsured.

Should you update your policy?

It is important to do your own research and decide for yourself. Choosi can be there to help with your research, to allow you to compare a range of home and contents policies.

Whether you’re now spending more time working from home or you just need to update your policy, it’s always a good idea to focus on finding the correct amount of home and contents insurance for your situation. Life is unpredictable and having the correct insurance policies in place can help to give you peace of mind that you are protected should the unexpected happen.

Check that your home – and any new home additions – are covered with home insurance and start by comparing policies with Choosi today. Understand that not all policies cover all types of household items, so check out How to read a PDS and understand the policy – Part 1 and Part 2 to get started.