What home insurance do you need and why is it important?
Some lenders insist on home and contents insurance, and others will also offer policies as a separate service. Insurance will protect your home against a wide range of events, which will differ depending on the policy.
Your mortgage broker and bank will most likely insist that you have coverage.
They want to make sure that the building will be replaced in the event that a disaster happens. For home and contents you’ll be paying something between $700 and $1,500 a year.
It’s important to shop around for insurance, as opposed to settling on the one your lender is offering. You can engage a general insurance broker to help you with this – they may be able to find a better deal that includes your cars as well the house.
It’s also important to not just go for the cheapest offer, but to choose insurance according to your specific property and location.
Cheapest isn’t always best. You’ve got to go with the one that will give you coverage that will pay out when you need it.
There are different clauses for insurance when it comes to floods, for example. When the Queensland floods happened, some insurers paid out and some didn’t. Which one would you have wanted to be with?
A home that falls under a Body Corporate may have some elements already insured. But you will need to read your contracts carefully to work out exactly what needs to be covered by you, and what is covered by the Body Corporate.
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