Everything you need to know about insuring your home
Posted on July 21st, 2021
For many people, getting a home insurance policy is a rushed after-thought amidst the excitement of buying a new home. If you’re in that position right now or you think you might be soon, here’s four quick tips to help you make the right decisions going forward.
- Get cover early
One of the biggest reasons people rush into a home insurance policy is because in most cases in Queensland, home buyers are required to insure their new property by 5pm the day after the contract of sale is signed. That doesn’t give you much time to decide on your level of cover, shop around and compare quotes. In some instances, a certificate of insurance is also required as part of your mortgage contract. This can sometimes feel overwhelming, so if you need a hand working through the different insurance options, call us at The Capricornian and we can walk you through each step.
2. Get the right type of cover
Building insurance cover includes the dwelling you live in as well as anything attached to the building and any improvements or renovations. Contents cover is for the things you keep in your home that aren’t fixed or installed, with the exception of carpets and curtains.
Valuables and portable items can also be covered as part of home and contents, usually with extra premiums added. As well as this, many insurers – including The Capricornian -offer different levels of home and contents insurance. Some include accidental damage and/ or motor burnout. The different levels of cover obviously come at different costs so you need to work out which level is right for you.
Accidental damage usually covers you for things like the kids drawing all over your walls with permanent marker or if you accidentally put a hole in the wall while moving furniture. Motor burnouts sometimes happen during a power surge or lightning strike and cause the motor to burn out or fuse and stop working. In the case of something like your fridge or freezer, motor burnout can cause inconvenience, expense and waste. Some policies will also have maximum benefit limits or exclusions relating to the age of the appliance so check the relevant PDS for details.
3. Get adequate cover
When determining the adequate ‘sum insured’ for your home insurance policy, you should work out how much it would cost to rebuild your home if it were to be completely destroyed instead of listing the purchase price or the amount the property was valued at. One of the best ways to help figure out the replacement value is to use an online calculator like the one built into the quoting platform here on our website.
To double check how your estimates stack up, it is wise to also consult with a builder local to your area. You should also keep in mind any increases in constructions costs when it comes time to renew your policy each year.
4. Check the exclusions
It’s important to read through the Product Disclosure Statement of any insurance policy you are considering. This will specify any exclusions and help you see where one policy might be more suited to you than the other – regardless of price. It will also specify claim limits that apply to particular items or events.
To check out the PDS’s for home insurance through The Capricornian, call us on 1300 314 900. Check with your insurer if premiums may be reduced if you increase the excess amount. Be realistic about what you would and wouldn’t be able to afford to pay should the worst happen.
Carefully consider any suggestions to lower your sum insured amount as this may not be a good way to reduce your premiums – it is could leave you underinsured and could end up costing you at a time when you need it most.
Disclaimer: Home & Contents Insurance is issued by Insurance Australia Limited ABN 11 000 016 722 AFSL 227681 trading as CGU Insurance. In offering these products, The Capricornian Ltd acts under its own Australian Financial Services Licence and under an agreement with the insurers, CGU. This is general information only and does not take into account your individual objectives, financial situation or needs (‘your personal circumstances’). In arranging this insurance The Capricornian Ltd acts as an intermediary for CGU, not as your agent. The Capricornian Ltd does not guarantee any claim or benefit payable under the insurance policy. We receive commission on insurance products details can be found in our Conditions of Use brochure. Before making decisions about any of these insurance products you should consider the appropriateness of the information having regard to your circumstances and the applicable Target Market Determination (TMD) and Product Disclosure Statement (PDS), available at any Capricornian branch or by calling 1300 314 900 The Capricornian Ltd ABN 54 087 650 940 AFSL / ACL No. 246780.