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How much Home Insurance cover do I need?

If you’re a homeowner, it’s your responsibility to ensure you have enough insurance cover for your home – if something unexpected were to happen you have the help you need to get back on your feet.

There are many different types of homes and insurance options to cover them. It may seem daunting to navigate all the extras and find a place to start.

When buying insurance, it is a good idea to focus on what you need, and what is (and isn't) covered by different policies. Generally, Building Insurance will cover the cost of repairing or rebuilding the physical structure of a property and Contents Insurance will provide cover for your personal possessions. 

Understanding total replacement and sum-insured cover

Total replacement covers all the costs to rebuild your home to the standard it was before it was damaged. A total replacement policy means you won’t have to worry about any shortfall to repair or rebuild your home.

Sum insured provides cover up to a set amount to repair or rebuild your home.

It is up to you to determine the total replacement and sum-insured cover for your home. Here are a few things to consider.

How much should you insure your building for?

Rebuilding costs generally go up over time and building codes change, the result being if you’ve lived in the same place for a while, the costs associated with rebuilding may have changed significantly. Let’s say for example when you first moved in to your home it was insured for $250,000. Fast forward to the present day and it could cost $400,000 to replace. If you haven’t updated your insurance, that’s a big gap in your cover.

The amount you insure for is known as your building sum insured.

  • The cost to rebuild your house depends on things like size, design, features, materials, and ground slope
  • It includes any permanent features such as timber floors, verandahs, carports and pools
  • But it shouldn’t include the land value.

To help you to receive an accurate estimate on the replacement value of your home, you can use the Building Calculator– it’s a prepopulated form using industry data collated by CoreLogic. It’s also a good idea to check what's covered in your insurance policy.

How much should you insure your contents for?

When determining how much to insure your contents for, add up the cost to replace them today and not what you paid for them. Ask yourself, how much would it cost if I had to buy all new contents today?

The amount you insure for is known as your contents sum insured.

  • An easy way is to go room by room, and make a list of all the items and their replacement costs
  • Your Contents includes carpets, rugs, curtains, internal blinds and shutters, and even the food in your freezer.


To help you estimate the value of your contents, you can check what's covered and use the Contents Value Calculator1.

Keep your sum insured on your Building and Contents Insurance up to date 

You can change your sum insured at any time to ensure you remain adequately covered. We recommend you review your cover regularly, to take into account things like:

  • Upgrades or renovations
  • Changes to the costs of labour and materials to repair or rebuild
  • Changes to building codes and regulations
  • Increases in the replacement value of your belongings
  • New purchases and gifts.

You’ve got a safety net just in case

Many home insurance policies will include a safety net, which means if your sum insured is not enough to cover rebuilding, repairing or replacing your building and contents, there is an additional financial buffer to cover the difference.

For example, construction costs often increase after a widespread storm, flood or bushfire because the demand for labour and building materials is higher.

Read more

How to avoid underinsurance

Underinsurance happens when the amount you have insured your home and/or possessions for isn’t enough to cover the cost of replacing them. A person is likely to be underinsured if their insurance cover is for 90% or less than rebuilding or replacing costs. Fortunately, underinsurance can be remedied. If you think you might be underinsured, take a look at these tips to see what you can do.
 

Home Insurance discounts and premiums

The cost of your premium is made up of a wide range of factors and some of your choices may also help reduce your premium. Choosing a voluntary claim excess. The higher the voluntary claim excess chosen, the lower your premium: $250, $500, $1,000, $2,000, $5,000.

 

What is covered by my home insurance policy

Your building and contents will be covered while your home is unoccupied for up to 60 days. Personal Valuables cover provides cover for various defined valuable items or your own specific items depending on what you arranged, for theft or accidental loss or damage anywhere in Australia and even overseas for up to 90 days.

 

Things you should know

1 The Building and Contents calculators available through our websites are intended as a guide only. For a more accurate rebuilding cost, consider obtaining a professional valuation from a licensed builder or professional valuer. 

*Quote and buy online and save 15% off your annual premium for the first year with promotional code COVER. Plus, save 10% when you combine home and contents at the same address under the one policy.

 

Westpac Retail and Business Banking Financial Services Guide, Credit Guide and Privacy Statement (PDF 85KB)

Home and Contents Insurance Product Disclosure Statement and Supplementary Product Disclosure Statements (applicable to policies issued or renewed on or after 1 July 2019) (PDF 339KB)

Home and Contents Insurance Product Disclosure Statement and Supplementary Product Disclosure Statement (applicable to policies initially issued in the period between 30 June 2018 and 30 June 2019; or renewed in the period between 30 July 2018 and 30 June 2019) (PDF 328KB)

View the Home and Contents Insurance Key Fact Sheets.

Home and Contents Insurance is issued by Westpac General Insurance Limited ABN 99 003 719 319 (except workers compensation cover where applicable). Westpac Banking Corporation ABN 33 007 457 141 distributes the insurance, but does not guarantee the insurance. This information does not take into account your personal circumstances. Read the Product Disclosure Statement to see if this insurance is right for you.