Buying a home
How much should I insure my house for?
15 February 2024
Home insurance, also known as building insurance, covers damages to the building itself not the contents inside like your furniture. If you've just bought your first home for $650,000 you might assume that that's the exact amount you need to insure it for. But the price you paid is not the same thing as the cost to rebuild your home.
Land value and house values are different. It can be tricky to accurately estimate how much it would cost to completely rebuild your home. Unless of course you happen to be a builder.
Building costs fluctuate from year to year and they're affected by construction demand as well as building materials and labor costs. If you've bought in a flood or bushfire zone it's very important to feel confident that your house is adequately covered. In storm season trees fall on houses and roofs get damaged. And in winter house fires happen from electrical faults, heaters failing or being knocked over and electrical blanket failures.
How do you calculate the cost to rebuild your home? Well, with Suncorp Insurance's building replacement calculator you can work out how much cover you'll need based on the current industry data. And the great thing is if you've just bought your home you'll have on hand all the important information like the size of the property and square meters roof and wall materials and the year of
construction.
If you’re buying or building a new home, you might be wondering how much home insurance coverage you'll need. Protecting your investment is important, so choosing the amount to insure your home and contents for – known as the sum insured – isn’t a decision you should make without being informed.
How you estimate your sum insured depends on a number of factors.
When insuring the building consider rebuilding costs, the size of your home and the quality of the fixtures and fittings.
When thinking of a sum insured for your contents, consider what the replacement cost of those items would be, as well as policy limits and the type of cover you want for them.
Types of property insurance
Building insurance
Building insurance generally offers cover for the structure of your home, including permanent fixtures and fittings like windows, walls and built-in wardrobes. It may also offer cover for permanent structures on the property such as sheds, carports, driveways, paths and fences.
With Suncorp Home Building Insurance, we offer different levels of cover. Depending on your level of cover, you can also get cover for:
- temporary accommodation, including utility costs, for you and your pets if your home is damaged and cannot be lived in
- replacement of your plants, trees and garden beds, and
- accidental breakage of glass items, such as fixed glass in windows, doors and sinks.^
Contents Insurance
Contents insurance can cover items inside your home, such as:
- carpets
- window coverings
- furniture
- appliances, and
- personal belongings.
If you are purchasing a new home, you may want to think about sorting your contents insurance earlier rather than later.
Building and Contents Insurance
Many insurance providers, including Suncorp Insurance, offer a combined Home and Contents Insurance policy. This type of policy covers both your home and the contents inside it. Combining these two types of coverage can also simplify the claims process.
Get a Suncorp Home & Contents Insurance quote
Underinsurance
Once you better understand what kind of policy to take out, you'll need to decide how much to insure your home and contents for.
Are your building and contents sum insured amounts enough to cover rebuild and replacement costs? Keep in mind that some policy benefits are calculated using a percentage of the sum insured.
Consider the tips below to help you avoid underinsurance.
Research your policy
No two homes are the same and neither are any two insurance policies. Make sure to thoroughly read your policy’s Product Disclosure Statement (PDS) so you know what is and isn’t covered. That way you can have the peace of mind knowing what you’ll be covered for should you need to make a claim.
Accurately estimate the replacement cost of your home and contents
A key way to avoid underinsurance is to accurately estimate the current replacement costs for your home and contents. To make this easier, we created a handy Building Calculator and a Contents Calculator to help you estimate your coverage needed. You may also want to contact a qualified building consultant or architect who may be able to assist with estimating your home's rebuild costs.
When valuing your contents, consider not only expensive items - such as jewellery and appliances - but also everyday objects like crockery, carpets and clothes. These items can add up in costs if they need to be replaced all at once.
Use Home & Contents Insurance Calculator
Regularly update your policy
Keep your policy details, including your sum insured, up to date as you make changes to your home - whether it's renovations or buying new furniture. Doing so can help you keep your home and contents covered.
Consider Safety Net Home Protection
Spikes in rebuild and labour costs following a natural disaster may mean that the cost of rebuilding your home could be more than originally estimated. That's why at Suncorp Insurance we include Safety Net Home Protection cover on Classic Extras and Classic Advantages Home Insurance policies, or as an optional cover for an additional cost on Classic Home Insurance policies.
With Safety Net Home Protection we will pay up to a further 25% of your home sum insured on Classic and Classic Extras policies, and up to a further 30% of your home sum insured on Classic Advantages policies when your home is damaged, and the cost of repairing or replacing it is more than your home sum insured. We'll either pay to:
- repair or replace your home, or
- pay you the amount quoted by a member of our supplier network to repair or replace your home.
Limits and exclusions apply, so please read the PDS.
Explore Safety Net Home Protection
When to take out insurance
Speak to your conveyancer or lawyer about when to take out insurance as insurance requirements differ depending on the state or territory.
Read more:
^ Limits, conditions and exclusions apply, read the PDS for full details about what is and is not covered.
Insurance issued by AAI Limited ABN 48 005 297 807 trading as Suncorp Insurance. Read the Product Disclosure Statement before buying this insurance. Go to suncorp.com.au for a copy. The Target Market Determination is also available. This advice has been prepared without taking into account your particular objectives, financial situation or needs, so you should consider whether it is appropriate for you before acting on it.
The information is intended to be of general nature only. Subject to any rights you may have under any law, we do not accept any legal responsibility for any loss or damage, including loss of business or profits or any other indirect loss, incurred as a result of reliance upon the information. Please make your own enquiries.
