Compare contents insurance

What is contents insurance?

Contents insurance is a type of home insurance that offers cover for your personal belongings inside your home, should they be damaged or stolen. Contents insurance is often part of a combined policy with home ‘building’ insurance, but you can hold contents-only cover if needed.

There are two types of contents insurance to pick from:

• Policies that only cover the value of your possessions, and
• Policies that replace your belongings with new items (a typically more expensive option).

Your insurance provider will likely put an overall cap on how much you can claim. However, it’s possible to find separate coverage for a single high-value item, such as an expensive piece of jewellery or art. 

A standard policy will usually only allow claims for events occurring inside your home – unless you choose portable contents insurance.

When am I covered by contents insurance?

A standard contents insurance policy provides cover for damages or loss resulting from:

• Fire
• Theft and vandalism
• Explosions
• Storms 
• Rainwater damage 
• Escaped water (e.g. a burst pipe)
• Lightning 
• Falling trees
• Earthquakes or tsunamis
• Floods (if you’ve added this optional extra).

If your contents are damaged as a result of an event that isn’t listed on your policy, then any claim likely won’t be accepted.

Keep in mind, definitions of each event can vary from policy to policy. For example, at the moment there is no standard definition of ‘fire’ that insurers must follow.

Possessions covered

A wide range of household items and personal belongings may be covered under a contents insurance policy. These include clothing, jewellery, computer equipment, sports gear, furniture, white goods, clothing, artworks, tools and gardening equipment, blinds and curtains and TVs. 

The items covered by contents insurance will vary from policy to policy. Make sure you read through the product disclosure statement (PDS) to check it has everything you need, before signing up.

What optional extras are available with contents insurance?

Most policies will give you the option to upgrade your cover with optional extras. These include:

• Portable contents cover. Essentially, cover for portable items if you take them away from your home. Some policies split this into ‘listed’ and ‘unlisted’ portable items. Listed contents are covered individually and for their full value, whereas unlisted contents fall under an overall ‘per claim limit’. 
• High-value contents cover. If you own items that are worth more, such as luxury watches or artwork, this extra cover ensures those items have the protection required.
• Accidental damage cover. Covers you for those moments when life happens in a way you weren’t expecting it to. Examples of accidental damage cover may include wine spills on the carpet or dropping your laptop.
• Underinsurance protection. This can be handy in case you undervalue your contents. If a policy offers 30% underinsurance protection and you find that you’ve undervalued your possessions, your insurance provider may pay you up to 30% more than the sum stated in your policy.
• Emergency accommodation. This generally covers some, or all, temporary accommodation costs, should your home become uninhabitable as the result of an insured event. This benefit is time restricted, such as 12 months.
• Electrical motor burnout. This covers motor burnout for items, such as whitegoods, after power surges. Keep in mind, there may be an age limit for the appliance to be eligible.
• Flood cover. Many insurance providers won’t automatically include this in a policy; you’ll need to get it added for a fee.

The policy add-ons available will vary from policy to policy. Whichever extras you add on, they’ll increase the cost of your premium.

How to calculate your insurance needs

Here are a few steps you can take when comparing contents insurance:

• Make a list. Look around at your valued possessions and take stock of what you have. When writing up your list, include everything from furniture to your laptop.
• Come up with a price. Try to put a value on your belongings. You’ll probably wind up with a rough estimate for items like clothing and an exact value for something like a laptop.
• Prepare for the worst. Think about which events you are most likely to need insurance for, based on where you live. This could be insurance against flooding, bushfires or theft.

Once you’ve completed these steps, you should have a rough idea of what you want to insure, and for how much.

How can I save money on my contents cover?

The goal when searching for content insurance should be for you to find a competitive price while ensuring you have enough coverage for your needs. 

Here are some ways that you can reduce your home contents insurance costs:

• Shop around. Avoid the trap of auto renewing your policy. Insurance providers have regular deals for new customers to maximise by switching.
• Secure your property. The more secure your property, the lower your premium might be. Measures can include installing locks on doors and windows, and setting up a security alarm or camera.
• Multiple-policy discount. If you have more than one product with a provider, you could be eligible for a multi-policy discount. Even if you don't currently qualify for this discount, speak with your provider about what deals they can offer to tempt you to switch to them.
• Flexible excess. You can reduce your insurance premium by opting for a higher excess. This means that, in the event of a claim, you’ll need to pay a higher upfront payment. But in return, your monthly insurance premiums may be cheaper.