For most Australians, a property is the largest and most crucial investment they will ever make.
Furthermore, a house doesn’t just have monetary value. A home is a living space for individuals and their families – a place of peace, security and comfort that you can return to after a long day and relax. For most of us, no commodity is so precious and vital to our lifestyle.
Therefore, it is advisable not to cut corners when it comes to choosing a home insurance policy.
The majority of homeowners take out both buildings and contents insurance to be extra safe. Buildings insurance covers the property itself and contents insurance takes care of the items housed inside.
Buildings insurance is required by law on any property which has a mortgage on it. If you do not plan to use the property as a domestic space, then there is no real need to take out contents insurance – it is only necessary to protect any belongings inside the property, after all.
Home insurance typically covers your property and belongings from storm damage, fire damage, burglary,plumbing faults, weather-related incidents and damage from vehicles. However, there are circumstances under which you will not usually be covered, such as flooding if your house is based on a flood plain, hurricane damage in hurricane-prone areas and acts of war.
Also not covered is damage to your property by infestation, damage to office equipment that you may own if you work from home and in some cases, damage to your property if it is vacated for extended periods of time. If you have a home office, you must take out separate business insurance and it is a similar story with vehicles in your garage which must be covered by car insurance. Some individual items may also require separate coverage, like rare and expensive paintings and sculptures.
Similar to most insurance policies, additional coverage is available and unsurprisingly, it will affect your premium. This coverage can extend as far as you like, as long as you are willing to pay for it. The greatest level of home insurance can even cover a nuclear attack! It is up to you as an individual on which policy you choose and how much coverage you would like to suit your specific needs. With home insurance, it’s always better to be on the safe side and choose a policy that will cover you in eventualities that are deemed improbable or unlikely. It is not worth running a risk on your home orpossessions in order to save a little cash in your payments. After all, if the worst does happen, theexpenses you may have to pay out can be immense.
Just remember that home insurance policies vary substantially with different insurance providers so it is worth shopping around before you make a decision. Although cost varies depending on your desired level of coverage, you are unlikely to get a decent policy for less than $1,000 per year. However, with good home insurance under your belt, you can enjoy peace of mind that your property and contents are safe and secure.