- You’ve heard about smart phones, but what about smart homes?
- Understanding Home and Contents Insurance
- Your Guide to Renters Insurance
- A home owner’s guide to Home and Contents Insurance
- Home and Content FAQ
- Contents insurance explained
- Landlord insurance explained
- Claiming home and contents insurance
- Home & Contents Queensland
- Fire Insurance
- The Average Value Of Home Contents
- The Best Home & Contents Insurance
Home & Contents Insurance Queensland
Your home is often your most valuable asset, so it’s a good idea to protect it with the right insurance cover. Queensland is especially prone to natural disasters and severe weather events, so home and contents insurance can be an essential investment for Queenslanders.
In this article you’ll learn more about finding the right level of home & contents insurance in Queensland.
What is Home & Contents insurance?
Home and contents insurance covers your home and belongings against damage and loss from events that are out of your hands, such as bushfires and severe weather events1. These policies can be purchased both separately, or as a package. You can normally choose from two types of home insurance, and two types of contents insurance:
• Usually a “sum-insured” policy, whereby you set the amount that it would cost to rebuild your home, and in the event of a claim the insurer will either rebuild it up to this value, or in some cases offer this set amount in cash
• Some companies offer “full replacement” policies (but again, they will often only cover you to what it would cost them to rebuild the home back to its original condition/style.)
• It’s important to note that if you over-insure you home, that is, take out a sum insured greater than the actual rebuild value of your home, you will still only be compensated for how much it would cost to rebuild, and not for the extra amount that you were covered
• Most insurers offer “new-for-old” replacement of your contents (which is usually capped at your ‘sum insured’)
• This means it’s important to be covered for the full value of your contents, as you won’t be compensated for any lost or damaged contents which fall beyond the value threshold established with your policy
• In the event of a claim you’ll only receive ‘new for old’ replacement of contents needing replacement, and not necessarily for the full amount you’re covered for in your policy
Policies can also have special conditions and various caps and exclusions. For this reason it pays to check the finer details before deciding which policy is right for you.
Risks to your Home & Contents in Queensland
Queensland is vulnerable to many types of natural disasters, including2:
• Storm surges
All of these events have the potential to cause substantial damage to your home and its contents, so it’s important to have the right insurance policy in place. The risks change depending on where you live in Queensland, and your insurance policy should accurately reflect the risks for your local area.
Brisbane is built on a floodplain3, so it’s particularly prone to flooding. The 2011 Brisbane flood affected 22,000 homes and caused more than $440 million in damage4. You can use current flood awareness maps3 to figure out if your Brisbane home is at risk of flooding, and take steps to minimise the risk to your home and your finances.
North Queensland risks
One of the biggest threats to North Queensland homes is cyclones5. Flooding is also a risk, but only equates to about 20% of insurance claims resulting from covered events5. In contrast, cyclone damage makes up nearly 60% of home and contents insurance claims5, so it’s worth choosing a policy that covers you for these severe weather events.
Cost of Home & Contents insurance in Queensland
As mentioned, the cost of home and contents insurance in QLD differs depending on where you live. This is because each area is prone to different natural disasters. There has been an increase in extreme weather events in Australia in the last ten years, which has caused home and contents insurance premiums to steadily increase in all states and territories5.
Queensland has maintained some of the highest premiums in Australia, with rates in North Queensland being almost 60%5 higher than in Sydney and Melbourne.
How are premiums determined?
As with other types of insurance, home and contents is determined based on risk. Queensland insurers may use a combination of the following factors to determine your premium6:
• How prone your area is to having floods, bushfires or other natural disasters
• Level of excess
• Chance of a claim
• Potential cost of a claim
• In-house operation costs and government charges
Your claim history, and the history of insured events in your area, are some ways that insurers may determine whether you’re likely to submit a claim6.
Cost of Home & Contents insurance in Brisbane
Premiums for policies that include flood cover in Brisbane vary greatly between locations5. This is because some Brisbane homes are more at risk of flooding than others.
Flood cover is sometimes completely excluded from home and contents insurance policies7. Others have special conditions or specific exclusions. If you live in a flood-prone area, make sure you check your policy carefully.
It may help to answer these key questions to avoid being underinsured after a flood:
• Does your policy cover you for damage caused by flooding?
• Are there any special conditions or exclusions that affect the level of flood cover?
• How much does it cover you for exactly?
• Is this enough to rebuild your home after a flood?
Average premiums in Brisbane are about 40% less5 than those in North Queensland, but still higher than those in Sydney and Melbourne.
Since the cost of flood cover can vary dramatically between policies, make sure you compare like policies for price and find the best deal for you. At iSelect, we can help with that.
Cost of Home & Contents Insurance in North Queensland
Cyclone risk differs from flooding. This is because cyclones cause regional rather than localised damage5. This means that everyone in an at-risk region will pay more on their premium to cover the risk.
North Queenslanders pay one of the highest premiums5 for home and contents insurance in Australia, largely because of the cost of cyclone risk. The only exception to this is north-west Western Australia, where cyclone risk and premiums are even higher.
As with flood cover, you should check that your policy covers you adequately for cyclone damage. The last thing you need after a damaging event is to discover that you’re underinsured.
Benefits of Home & Contents insurance
Home and contents insurance could save you a lot of money and stress in the event that you need to make a claim.
The damage caused by cyclones and floods in Queensland can be severe, and the cost of repairs high. Buying adequate insurance can ensure you’re able to rebuild your home without being left out of pocket. This can often mean the difference between losing everything, and being able to comfortably start over.
Ready to compare Queensland Home & Contents policies?
The frequency and intensity of natural disasters in Queensland is a good indication that home and contents insurance is an essential part of owning a Queensland home.
Policies differ greatly though, so you should shop around to find the best policy for your home and local area. At iSelect, we can help you find the right home and contents insurance and give you peace of mind if the unexpected should happen to you.
Start comparing policies online now or call us on 13 19 20.
iSelect does not compare all products in the market. Not all products are available at all times.
iSelect General Pty Limited ABN 90 131 798 126, AFS Licence Number: 334115. Any advice provided by iSelect is of a general nature and does not take into account your objectives, financial situation or needs. You need to consider the appropriateness of any information or general advice we give you, having regard to your personal situation, before acting on our advice or purchasing any product. You should consider iSelect’s Financial Services Guide which provides information about our services and your rights as a client of iSelect. We receive commission for each product sold.