Home insurance needs differ for everyone, so when should you get home insurance? Follow this checklist and learn about home insurance in Australia.
Is it the right time for you to buy home insurance?
It's not surprising to learn that most Australians would prefer to own their own home rather than rent perpetually, making homeownership "the dream" for so many. However, while the desire to own a home is pretty clear, many homeowners are uncertain about buying insurance, or even whether they need it in the first place.
While you can abundantly find home insurance quotes online, deciding whether to purchase insurance can require considerable research. Fortunately, RateCity has provided a set of questions that may help you determine whether it is the right time to buy homeowner's insurance.
Will you be taking out a mortgage to buy the house?
There are many Australians who take out a mortgage to buy their homes. It's not unusual for banks or lenders to require homeowner's insurance as it helps guarantee the cost of their financing overall.
It's great for you, but home insurance can be a factor in settling a home purchase.
Is your home in an area prone to bushfires, floods, or other extreme events?
You should know the risk of damage to your new home before you start to settle in. Typically, you'll want to do some research about any risks associated with where you're moving to, but if you haven't, quickly search what's happened online, or even ask neighbours.
If you're new to the area, a quick chat with a local will not only give you an idea of what you should be on the lookout for but get you familiar with the neighbourhood. Alternatively, make a call to your local council to get a gauge on what you can expect. Some areas may be more disaster-prone than others and can add to your cost of living.
Home insurance is practically a necessity for any homeowner and may be required by the terms of your mortgage agreement. Insurers may suggest or require you to purchase customised flood or fire damage insurance, in addition to a regular home insurance policy.
Are you buying an established dwelling?
Also called an "old home", an established dwelling brings with it a sense of history and perhaps also a housing style that may not be found in new constructions. You can typically find these across Australia, and it's not unusual to buy a home that has been passed down for generations.
However, those generations may not have been kind to the structure, and older homes need to be inspected thoroughly to ensure that previous owners have not shirked on maintenance. All maintenance inspections should be done before signing the contract to your new home to give you the lay of the land - your land in fact.
In most states, the risks associated with the property transfer to the owner either immediately or on a date explicitly mentioned in the contract. This means you will likely inherit the flaws once the deal is made, and have to deal with any repercussions. Insurance providers may not cover damage arising from gradual wear and tear. However, it's still important to cover a home all the same. Consider talking to your home insurance provider to find out what your cover entails.
How many valuables do you own?
We all own lots of different things that have value in our lives. Whether it’s a TV, computer, jewellery, clothes, or even little bits and pieces collected from the family over the years, everything you own inside your home holds a value, and these should be protected from theft or damage.
Contents insurance allows insurers to protect the things inside your home from both theft and damage, allowing you to place a broad dollar figure value over what you own collectively, helping you to replace it if the worst does happen.
Are you renovating your new home?
Like most things, change is a fact of life. When you own a home, things may change, and over the time you've been living in your home, changes to the structure or what's inside are highly likely. Renovations are a part of life as a homeowner, so is upgrading the things inside the home. As such, you may need to buy additional coverage or revise your existing policy, ensuring that your home and valuables have the right level of home insurance.