Home insurance for renters: what do you need?

When renting a home, you might assume that as a tenant, you do not need to purchase insurance. While it is true that a landlord will be required to insure the property itself, this policy will generally not extend to the personal belongings of the tenant.

Therefore, if you wish to protect these items, you should investigate the purchase of contents insurance for your rented home. This type of insurance is offered by all major firms and generally costs around $300 per year.

Know Your Policy

• Make sure to decide what types of protection are required by your home situation. Consider whether your belongings are particularly at risk of breakage, burglary, flooding, or fire; choose an insurance plan that will offer the necessary coverage. Also consider whether your circumstances warrant the protection offered by public liability insurance.
• Take note of any particular exclusions of coverage by your policy. Check its wording carefully to discover to what extent your belongings will be protected if lost or damaged outside the home, for instance, items left in your car.

Valuing Your Possessions

• When insuring home contents, you must submit proof of the value of your belongings to your insurer to ensure that you are adequately covered. Such proof may be in the form of an itemised list accompanied by purchase receipts, warranties, serial numbers, instruction manuals, photos or videos of the items in question.
• Make sure to retain a copy of such information yourself, and keep the list of your valuables up-to-date; this will assist in the possible recovery or replacement of stolen or damaged goods.

Moving House

• If moving house, you should notify your home contents insurer, as your new location may expose your items to different risks, and so require an alteration of your policy.
• Before you move, make sure that the contents policy currently in effect will protect your belongings in case they are damaged during the move itself.

General Tips

• Many insurance firms offer cheaper contents covers if you take additional security measures such as installing deadbolts, or putting up . However, make sure to do so in accordance with your lease agreement.
• You can also save by choosing a plan with a higher excess However, if you want to be fully protected, select a policy with a low excess and make sure to value your belongings at the full cost of their replacement.
• If you are sharing your home, it is cheaper to share the cost of joint contents insurance than to take out several individual plans. Make sure that all your housemates reach an agreement on the distribution of this cost.

More Information:

• The Government website Understanding Money is a great place to look and has a fact sheet about insurance. Take a look at the financial literacy pages.
•  The Insurance Council also has some great advice for residents and consumers. You can find some of their consumer guides here.
• The FIDO website, the consumer website for the Australian Securities and Investments Commission (ASIC), also has some relevant information in the home insurance section. Take a look at the web pages about insuring your home.