What are the 5 key insurances home owners should have?

March 03, 2015
David Thomas

What are the 5 key insurances home owners should have?

Australians are notoriously underinsured. While many of us understand the value and benefit of insuring our vehicles, we don’t seem to place the same emphasis on ourselves or our home.

According to the Insurance Council of Australia, approximately 3.8 per cent or 201,000 owner-occupied homes are not insured, while data from Roy Morgan suggests that as many as 10 per cent of Australian households are not insured.

These statistics are alarming for a couple of reasons.

Firstly, your property is likely to be one of the biggest financial assets you have, so it makes sense to insure it properly.

Secondly, your mortgage is one of the biggest financial commitments you can ever make, so it is important for you to adequately insure yourself so that you and your mortgage repayments are covered in the event an unforeseen circumstance arises.

So what are the types of insurance that you as a home buyer should have? At Mortgage Choice, we believe there are at least five ‘must have’ insurances for all home owners, including:

1)      Home Building and Contents Insurance:

Your house is more than just a roof over your head, it is a huge financial asset and commitment so it doesn’t make sense to leave things to chance. Building and contents insurance offers you financial protection against a wide range of threats including loss through burglary or damage by fire. When you consider the value of your home, having building and contents insurance in place is a very smart move.


2)      Landlord insurance:

If you have bought an investment property rather than an owner-occupied property, it makes sense to get landlord insurance. In addition to protecting your rental property against loss or damage caused by events such as fire, storm and theft, landlord insurance offers you the added benefit of public liability cover. There is also a range of additional cover options to choose from including rent default and theft by tenant. The premiums on landlord insurance can normally be claimed as a tax deduction, which makes it even more affordable.


3)      Building insurance:

If you have chosen to build your new home rather than purchase an existing dwelling, it is highly advisable to take out building insurance before the contract of sale goes unconditional. Once the contract moves to unconditional, you are liable for the property (even though you don’t technically own or live in it yet). Building insurance therefore protects you in the event that something goes wrong between when the contract goes unconditional and when you move in.


4)      Income protection:

Income protection is a monthly benefit that can pay you up to 75% of your income in the event you fall ill or are injured in an accident. This insurance will give you piece of mind that you can continue to meet your mortgage repayments even if you aren’t able to work for a period of time. Better yet, it is tax deductible, so there is no reason for you not to be covered.

5)      Life insurance:

Life cover offers a lump sum payout to the people you nominate in the event of your death. It's a simple, affordable way to give your family peace of mind that if anything happened to you, they would be spared the additional trauma of financial stress at a time of personal loss.


As your local Mortgage Choice broker in Victoria Point we can make sure you and your new property are both adequately insured – providing you with peace of mind.


For further information, and to put yourself in the best position with valuable information and guidance, contact a trusted consultant from Mortgage Choice on 07 3286 7711.

Posted in: Insurance

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