When is the right time to buy home insurance?

It's important to remember when buying insurance for your new home that home insurance policies need to be customised - you need to know what kind of coverage you need. For instance, if you live in a neighbourhood prone to theft or prone to natural disasters, you may want to check if coverage limits or exclusions may apply for certain events.

There are two main types of home insurance policies. The first, total replacement cover, should be able to take care of the full cost of repairing or rebuilding your home if it is damaged or destroyed in an insured event. This can provide peace of mind, though the premiums may be more expensive.

The second, sum-insured cover, involves estimating the potential cost to repair or rebuild your house, and insuring your home up to this maximum amount. This may have more affordable premiums, but you could risk finding yourself underinsured if your home’s repair or rebuilding costs blow out (though some insurers offer a safety net).

Most insurers can help you calculate the potential cost of rebuilding your home and set a home insurance sum. A free property report could help give you a better idea of your home’s value as a part of making these calculations.

The best home insurance option for you may depend on your financial situation and your household’s needs. Insurance providers will be looking to negotiate coverage within tightly defined limits and exclusions.

Keep in mind that when you make a home insurance claim, you’ll need to pay an excess. A higher excess can mean lower home insurance premiums, though you’ll be paying more out of your own pocket if disaster strikes. On the other hand, a lower excess means the insurer will take care of more of the repair or rebuilding costs, but you’ll likely pay a higher premium.

1. Work out how much insurance coverage you require for your home, and if you will also need insurance for your possessions
2. Collect documents and information for home insurance quotes, such as property details, value, and security measures
3. Compare home insurance quotes online, including coverage, premiums, features and benefits
4. Check the exclusions, maximum claim limits, and any other limitations on each quote
5. Contact your preferred insurer to accept a quote and finalise a home insurance application

If you’re not sure which policy may best suit your needs, you could consider contacting a few insurers before making your decision. You could also ask family and friends about their experiences with different insurers.

Remember: it's important to get a home insurance policy that offers adequate coverage for your new home; taking pains to get it right will prove worthwhile in the long run.