Five benefits of home insurance that not all policies offer

Knowing some of the basics of a home and contents insurance policy may help you get a better idea of the value offered by an insurer’s extra coverage.  

Insured events

These are the incidents which can cause damage to your property and are covered by the policy. Many home and contents insurance policies include coverage for:

• fires
• storms
• lightning
• hail
• theft
• vandalism
• riots
• accidental leakage

Even if your policy doesn’t offer certain types of cover as standard, such as for floods and accidental damage, you may be able to add this cover to your policy as an optional extra by paying a higher premium.

Rebuilding your home after a disaster

Home insurance policies may cover either an insured sum - which you and your insurer agree should cover the cost of replacing your home - or the total replacement cost of rebuilding your home if it is damaged in an insured event. Damage to fences, solar panels, garages and sheds, and swimming pools will often also be covered.

Replacing your valuables

If you’ve purchased contents insurance, either separately or as a combined policy with home insurance, replacing your precious belongings may be covered. However, you may need a separate policy for expensive items, or for items you carry with you out of the house.

Excess and premium

The excess is the portion you agree to pay out of pocket when you file an insurance compensation claim. While you’ll need to set aside savings for the excess, choosing a higher excess can bring down the premium, which is the cost of your home and contents insurance policy.

The difference between the policies offered by different insurers may boil down to what extra coverage each insurer offers as sweeteners. Consider checking if your insurer offer the following extra coverage as part of its home and contents insurance policy:

1. Rebuilding costs

Some insurance providers may cover all the costs associated with rebuilding your home, which includes not just the cost of materials, but also the fees you need to pay an architect or a building contractor. If you need to use green materials or comply with green building regulations, any associated costs may also be covered by your policy.

2. Removal of debris

Suppose a storm partially damaged your home and dumped a pile of wreckage on your property. Your insurance policy may compensate you for removing the damaged material - the debris - from your property.

3. Temporary accommodation

Did you know that, depending on your insurer, up to a year of temporary accommodation may be covered in case your home needs to be rebuilt? What’s more, you could also get compensation for the cost of temporary housing arrangements for your pets. Check your insurer’s PDS for details.

4. Legal liability coverage

Your home will probably see many visitors over the years, and you may be liable if they are injured in your home. As long as the injuries weren’t caused deliberately, your home insurance policy may cover your legal responsibility for others’ injuries in your home.

5. Electrical appliances and electronics

If an insured event, such as a lightning storm or fire, causes a power surge or power outage, you may be able to claim compensation for damage to electrical items. Note that you may need to add on coverage for motor burnouts, which are also called fusion damage. Your LED TV, mobile phones and laptops may also be covered by your home and contents insurance policy, although you may need to check the limit of this coverage.