How much should I insure my house for?

Your home and belongings are precious and may feel irreplaceable, but do you know how much they’re really worth? It can be handy to know how much it would cost to replace them from scratch. 

Here’s a closer look at what affects the value of your home and contents, and how to decide the right level of cover for you. 

Home and contents insurance: How much is enough? 

Homes come in all shapes and sizes – as do the insurance options to cover them. With so many levels and extras available, many homeowners aren’t sure which insurance policy is best for them. 

Instead of feeling overwhelmed, there are a few considerations to help estimate your home and contents insurance needs – home rebuilding costs, contents replacement costs, sum-insured amounts and additional features. 

Calculating home building costs 

To select the right home building insurance, you first need to know what it would cost to replace everything that makes your house a home. Two common ways to work this out are cost-per-square-metre and elemental estimating. 

The cost-per-square-metre calculation takes very basic information – such as the size of your home – and provides a rough estimate for insurance of that space. While it’s a quick way to estimate your level of insurance, it can be inaccurate in terms of actual replacement costs. The elemental estimating method provides a much more detailed assessment of your asset as it considers things like: 

  • period of construction (eg Victorian, Federation or contemporary) 
  • size (including total area and floors)
  • construction quality (eg quality or prestigious) and materials used, and
  • other features such as bathrooms, garages, balconies, lighting, heating and security systems.

It’s important to take into account the true cost of rebuilding your home – many construction and wage costs may have dramatically changed since it was first built. 

Need a quicker way to estimate the total value of your home and contents? We’ve created a Building Calculator to help you.

Calculate The Replacement Value Of Your Home

Calculating contents costs

It’s imporant to accurately assess what you own and determine how much it would take to replace it. For example, the average value of an Australian household’s home contents is estimated at $61,0001 – including everything from jewellery and appliances, through to furniture and works of art. 

While the bigger ticket things such as appliances and valuables may be easier to assess, it’s also important to consider the value of your everyday items including crockery, cutlery, clothing and bed linen. These can add up if they’re damaged and you need to replace them all at once.  

Accurately estimating what you own can be tricky. A few simple tricks to help you include: 

  • go room by room and catalogue your valuables
  • regularly update your list 
  • take photos of your valuable items 
  • keep receipts where needed 

The more thorough your contents record-keeping is, the more accurate your sum-insured will be. This can help speed up the claims process should you need to make one. 

Understanding sum-insured cover

The ‘sum-insured’ for your policy is the maximum amount you can claim for any one incident. It should be  enough to cover and replace everything if your home and its contents were damaged or destroyed.

For example, if your home is insured for $500,000 and your contents total $100,000, your sum-insured amount for home and contents would be $600,000. Remember, the building sum-insured amount is not the price you paid for the property, or what the market value is – it’s the total you’ve estimated to cover any rebuilding costs. If your rebuild costs more than the sum-insured amount, you may have to make up any shortfall. Similarly, it’s up to you to ensure your contents are covered for their full ‘new for old’ replacement value. To stay on top of your total sum-insured amount, regularly assess both your home and contents insurance values to make sure you aren’t in danger of being underinsured.

Safety net home protection

If your home is destroyed or badly damaged, there’s no guarantee that the sum-insured amount will be enough to cover the costs of rebuilding it or replacing its contents. Some premium levels of insurance will offer you a safety net above the sum-insured amount in the event your estimate doesn’t quite cover all costs. 

GIO’S highest level of coverage is designed to protect your home and contents against various forms of damage, from bushfires and floods to theft and vandalism. Along with the highest level of cover for loss or damage for insured events, our Platinum Home and Content level of cover will also pay up to a further 30% of your home sum-insured amount to: 

  • repair damage
  • replace your home, or
  • pay you what it would cost us to repair or replace your home.

If you want to be certain you’re covered should the worst happen, choosing insurance with a safety net home protection can offer that extra peace of mind. 

Understanding additional features and optional covers

Whether you’re insuring your first property or your ultimate dream home, it’s important to know exactly what’s covered.

Choosing the right cover for you can take considerable time and research. To help target your search, it’s recommended you regularly check your policy for what’s included in your coverage, including optional covers and automatic limit amounts.

Temporary accommodation

If your home is damaged, you’ll probably need to find alternate accommodation until it’s back to a liveable condition. In some cases that could be for months, or even years.

GIO’s Platinum Home & Contents Insurance can cover the costs of temporary accommodation for up to 24 months (up to 10% of your sum-insured amount), while your home is being repaired. Under this level of cover, we’ll also pay for your pet’s accommodation should they need a temporary home, for as long as you’re waiting for your home to be rebuilt.

Home improvements

Some optional extras cover you for environmental improvements you add to your home, such as solar heating systems and rainwater tanks. For example, our Platinum Home & Contents Insurance will cover up to $5,000 of environmental updates, as long as they are new features to your home.

GIO’s Platinum Home & Contents Insurance also covers home modifications needed due to injuries sustained during an insured event (eg paraplegia or quadriplegia), along with any unforeseen updates required to comply with the latest home building regulations.

Flexible extras

GIO’s Platinum Home & Contents Insurance offers a range of optional covers, including cover for pet injuries and compensation for domestic workers. It also allows you to increase cover for your precious items and valuables, meaning you can increase your set fixed limit and make sure you’re properly reimbursed if something special is lost or damaged.

Choosing the right cover

While all levels of insurance offer some peace of mind, something as important as your home and valuables deserve the best coverage possible.

With GIO’s Platinum Home and Contents Insurance, you can rest easy knowing you have the highest cover for loss or damage for insured events, accidental loss or damage at home.

Discover GIO’s Platinum Home And Contents Insurance


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Insurance issued by AAI Limited ABN 48 005 297 807 trading as GIO. Consider the Product Disclosure Statement before making a decision about this insurance. This advice has been prepared without taking into account your particular objectives, financial situations or needs, so you should consider whether it is appropriate for you before acting on it.

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