Overwhelmed by the number of insurers out there? Find out how to spot what really matters in a home insurance policy.
With all the love and life and pasta stains you pour into your house, it’s important to protect it. When you’re clicking furiously around online trying to find the best policy, though, it’s pretty easy to get overwhelmed by the insane amount of options on offer.
As with anything on the internet, there’s a good chance some of these are scams and some are genuinely great. But how much can you trust those anonymous people posting horror stories of insurance claims gone wrong?
Luckily, there’s an easy way to get past all the dodgy discounts and dubious reviews floating around. We’ve put together a guide that will help you figure out what to look for and what to ignore when it comes to comparing home insurance.
Quick reviews of some home insurance policies
Budget Direct Home Insurance
Budget Direct Home Insurance benefits include:
- Economical pricing for reasonably comprehensive offerings
- Up to 30% off your first year’s premium when purchasing online
- Safety net of up to 25% if your sum insured falls short of the actual cost required to repair or replace your home
CGU Home Insurance
CGU Home Insurance cover includes:
- Cover for a uniquely wide variety of accidental damage to your home and/or contents (Premium package)
- Cover for your belongings anywhere in AU or NZ for 90 consecutive days, in addition to when they are kept permanently at home (Premium package)
- Cover for bicycles (unless used in racing) of up to $20,000 and watercraft (up to specified lengths), under all contents policies
- Optional worldwide cover for valuables
- Up to $5,000 cover for guests’ uninsured belongings
Westpac Home Insurance
Westpac Home Insurance benefits include:
- Up to 30% discount if you apply online, bundle your policies and have an existing Premier Advantage Package home loan
- Optional worldwide cover for portable items, up to 90 consecutive days
- Safety net of up to 30%, depending on your level of cover
- No additional charge is incurred if premiums are paid monthly
- Optional emergency accommodation for your pets
Virgin Money Home Insurance
Virgin Money Home Insurance benefits include:
- Up to 30% discount plus 5,000 Velocity Frequent Flyer points if you purchase your policy online
- Optional safety net of up to 25%
- Up to $500 cover for lock replacement
- Up to $500 cover for the uninsured belongings of guests and visitors
NRMA Home Insurance
NRMA Home Insurance cover includes:
- Up to 25% no-claim bonus
- Safety net of up to 25% on top of the contents sum insured to help with replacement costs
- Pet Lover’s option of up to $2,000 for vet bills if your dog or cat is injured in an accident
- You’re still covered if you accidentally leave your home unlocked, unless you give the thief or vandal consent to enter
- Any authorised repair work is guaranteed for the lifetime of the building
Woolworths Home Insurance
Woolworths Home Insurance benefits include:
- Outdoor contents covered for up to $8,000 under Comprehensive policy
- Home office contents covered for up to $10,000 under Comprehensive policy
- Contents at both your old and new addresses are covered for up to 14 days from when you commence the moving process
- Temporary accommodation for dogs and cats included in both Standard (up to $500) and Comprehensive (up to $1,000) building insurance policies
- Up to $600 for replacement of locks under Comprehensive policy
RACQ Home Insurance
RACQ Home Insurance member benefits include:
- Lifetime guarantee on authorised repairs
- Generous range of discounts, including cash back when you buy a policy online, 17.5% off if you have Roadside Assistance membership, plus a no-claim bonus, multi-policy discount, reduced premiums for seniors and retirees, and discounts for people living in apartments as well as those who have monitored alarms installed
- Cover for damage caused by emergency services
- Up to six counselling sessions are covered, for trauma caused by an insured event
- Premiums can be refunded or waived if a policyholder is genuinely made redundant and remains unemployed for a minimum of three months
- Up to 20% discount for applying online
- Temporary accommodation for dogs and cats
- Cover for accidental damage included as standard with Top Cover package
Allianz Home Insurance
Allianz Home Insurance customers can benefit from:
- Uninsured property of guests covered up to $5,000
- Up to 30% no-claim bonus
- Worldwide liability cover
- If your claim for rebuilding a total loss of your home is approved, you will receive up to $5,000 to install eco-friendly features including rainwater collection and solar power systems
Chubb Home Insurance
Chubb Home Insurance benefits include:
- “Prestige home and contents” insurance, aimed at high-value property and unusually expensive belongings, such as fine art collections
- Your contents are covered against accidental loss or damage, anywhere in the world
- Safety net of up to 20% above the sum insured to cover the full cost of rebuilding your home after an insured event
- You have the option of hiring the craftsman or repairer of your choice
QBE Home Insurance
QBE Home Insurance benefits include:
- No-claim bonus calculated on a sliding scale
- Home Prestige policy covers accidental damage to your home and/or contents
- People aged 50 or older receive a discount, and people who are retired also receive a reduction in premiums
- If your home is a total loss and the estimate provided by QBE’s home insurance calculator proves inadequate, you receive a 30% safety net
- Various optional extras are available, including cover for belongings in storage or in student accommodation, bicycles, worldwide cover for portable items, accidental damage to any possession or the home itself, and injury compensation for people working in your home (such as a housekeeper)
Real Home Insurance
Real Home Insurance benefits include:
- 20% off if you buy combined home and contents on Real Home Insurance online
- Optional extras such as motor burnout
- Flexible payment options
AAMI Home Insurance
AAMI Home Insurance cover includes:
- Up to $50 discount for online applications, plus 10% off if you bundle home with contents
- Complete Replacement Cover, available as an optional extra on Home Building and Landlord insurance. If your claim is approved, your home is guaranteed to be repaired or rebuilt to its exact condition prior to the insured event, regardless of how much this costs
- Lifetime guarantee on approved building repairs
OnePath Home Insurance
OnePath Home Insurance member benefits include:
- Multiple policies
- Loyalty discounts
- Seniors discounts
AMP Home Insurance
AMP Home Insurance provides cover benefits including:
- Multi-policy discount
- Combined home and contents discount
- Top Strata Insurance discount
Suncorp Home Insurance
Suncorp Home Insurance benefits include:
- Up to 14 days’ cover for both addresses while you are in the process of moving
- Lifetime guarantee on repairs that are arranged by Suncorp
- Up to $100 discount for online quotes
- Safety net of up to 30%
- Higher limits are available for items such as artworks (up to $200,000 per artwork) with Classic Advantages policy
See one that tickles your fancy? Compare some options here
There’s plenty you need to keep an eye out for when comparing home insurance reviews, but the item at the top of the list for many people is how much the policy costs. In addition, take the following factors into consideration:
- Where do you live? The location of the property might pose more of a risk to an insurer. For example, if your home is located in an area prone to bushfires or with a high crime rate, you will likely pay a higher premium.
- How was your home built? The construction of your building can affect its ability to withstand damage, while the installation of home security systems can deter thieves and therefore lower your premiums.
- What is the excess? You can lower the cost of premiums by electing to pay a higher excess. This is the amount that you will need to pay out of pocket.
- How much does it cost? Policy costs obviously differ between insurers and also depending on the level of cover you select, but there is a range of other factors that can also affect your premiums. If you're looking for contents insurance to safeguard your valuables, most insurers will give you a discount for bundling home and contents insurance.
- Do you know what the policy actually covers? The next thing you should look for in a home insurance review is what is actually covered by the policy. Generally speaking, there are two types of home insurance policy available: defined event policies and accidental loss or damage policies. A defined events policy covers you against accidental loss or damage caused by incidents such as fire, storm, theft and explosion, while an accidental loss or damage policy covers all losses as long as they are accidental.
- Does the policy offer new for old replacement? Once you know what’s covered, consider whether your policy offers indemnity cover or replacement cover when you make a claim. Under indemnity cover, your policy will replace the loss of your building up to its market value – e.g. taking into account factors such as depreciation. But if you have replacement cover, you’ll be covered for the true replacement cost of the home or item. A common term you will see used in insurance policies is "new for old replacement".
- Do you understand the exclusions of the policy? As you examine more insurance policies, you’ll soon realise that each policy contains a list of general exclusions. These are circumstances when an insurer will reject your claim, such as if you fail to take reasonable steps to prevent any loss or damage occurring, or if you lodge a dishonest or fraudulent claim. You’ll need to examine each policy’s list of exclusions to determine whether any of them will affect you.
- Do you understand your cover needs? You’ll have to work out how much cover you actually require. While some policies will cover you for total replacement, others will only cover your sum insured. If your sum insured is only $300,000 but the real cost to rebuild ends up being $400,000, you could end up $100,000 out of pocket.
- Do you know the size of your property? When it comes to estimating the amount of building cover you need, most insurers are able to provide an accurate estimate of the replacement cost based on the materials your home is constructed from as well as its size. You’ll also need to check that your policy covers things like demolition, removal of debris, architects’ fees and more.
- Do you know how much cover you need? If you need to estimate the amount of contents cover you require, the best thing to do is take the time going through each room of your house and working out which items you would need to cover, as well as their replacement value.
- What kind of range does the insurer offer? The first thing you’ll need to consider when comparing any home insurance companies is the type and range of policies they offer. Do they offer standalone building insurance and contents insurance, and do they allow you to combine your building and contents cover into one insurance package? Do they specialise in home insurance or do they offer a full suite of insurance products?
- Do you know who the underwriter is? Next, look at who underwrites the insurer’s policies. When you apply for cover, the insurance underwriter assesses your level of risk and determines whether the insurer should offer you cover, as well as under what conditions that cover should be offered. Look for a policy that has been underwritten by a major insurer – one that’s backed by years of experience and a position of financial strength. You will have heard of many of these companies already, but a quick online search is an easy way to inspect an underwriter’s bona fide details before you apply for cover.
- What is the company's claims history like? Another important issue to look at is how the insurer handles claims. How are claims settled? What is the maximum amount the insurer will pay? What sort of evidence and documentation will you need to provide to support your claim? How quickly are claims processed? Look for an insurer with an impressive reputation for handling claims quickly and efficiently, and for always paying out on valid claims.
- What are the benefits and features? You’ll obviously want to take a closer look at what a policy covers. What risks are you protected against and to what level? Are extra costs, for example the removal of debris and demolition costs, included in your cover?
- Are there any optional benefits you need? Many policies will also allow you to add optional benefits to your policy for an extra cost, so which added benefits are available to you? For example, accidental damage or electrical motor burnout might be offered as options on your home insurance policy.
- Have you checked the definitions section? Make sure to familiarise yourself with your insurer’s definitions of "building" and "contents". You’ll need to be certain about what is covered by which section of a home insurance policy.
- How are premium payments made? Do you need to pay your premium in a lump sum or can you opt to pay it in installments?
- How long is the cooling-off period? Every home insurance policy will have a cooling-off period after you purchase cover. During this time, you are able to cancel your policy and receive a full refund of any premium you have paid.
- Have you examined the exclusions? The list of general exclusions is something you should examine on any insurance policy. You don’t want to end up with an unpleasant surprise when it comes time to make a claim on your policy.
- Can you bundle and save? Many insurers will offer you sizeable savings on your insurance premiums when you bundle two or more policies together. Speak to your insurer about the multi-policy discounts that may be available to you.
- Your insurance needs. Determine the type and level of cover you need before you start shopping for a policy. Do you need building insurance, contents insurance or both? How much would you need your policy to pay out if the worst happened and you lost everything?
- Your current cover. If you already have a home insurance policy in place, consider whether it meets your needs. Are you paying for benefits you don’t need? Are you under-insured or are there gaps in your cover that need to be filled?
- Whether you can afford the premiums. While the peace of mind offered by a comprehensive home and contents insurance policy might sound very attractive, don’t bite off more than you can chew. You’ll need to work out whether or not you can afford the insurance premiums before you purchase cover.
- If you understand the fine print. Reading insurance policy documents is far from an entertaining way to spend your time, but it’s the best way to ensure that you end up with the right type and level of cover for your needs. It's a good idea to email the insurer to ask them for clarification on anything you're unsure about.
- Review your cover needs regularly. Your circumstances are changing all the time, so don’t forget to take stock of your cover requirements regularly. This could end up saving you a lot of money, as could shopping around for a better deal rather than simply automatically renewing your policy every year.
While home insurance reviews can provide valuable information about an insurer, it's always wise to read more than one review. Here's why:
- What if you're just reading the opinion of one disgruntled customer? We've all seen them, reviews from current and former customer just trashing their provider. Warnings like, "IT'S A SCAM" or "NOT AS ADVERTISED" litter review sites. The problem is that a lot of these people didn't understand what they were getting in the first place and that misunderstanding leads to frustration. This frustration commonly manifests itself in online reviews.
- Is that review that you're reading on the insurer's site unbiased? While these testimonials can provide some insight into the benefits of a product, you know that the company is not going to use a scathing review on its own site.
- This product has a great star rating so it must be the best, right? Ratings given by consumer reviews should only be used as a general guide. More accurate star ratings can be found on government or consumer watchdog sites.
- Who wrote that review you're reading? If you're reading a guest post, it's quite possible you're actually reading something written by the company's PR department.
- Are forums a good place to get an unbiased review? Forums can be a great starting point on your comparison journey, but just like anywhere on the Internet, you'll find more negative than positive. According to the White House Office of Consumer Affairs, a dissatisfied customer will tell between 9 and 15 people about their experience, while happy customers tell about 4–6 people.