Think about everything inside your home—from your furniture and appliances to your clothes, tech, and jewellery. Now imagine what it would cost to replace all of it tomorrow. That’s where contents insurance comes in.
Whether you rent or own, contents insurance protects your personal belongings from loss, theft, or damage. It’s a safety net that ensures you’re not left footing the bill for unexpected events like fire, burglary, or even accidental breakages.
Let’s explore how it works and why having the right cover matters more than you might think.
🧾 What Does Contents Insurance Cover?
Contents insurance pays to repair or replace the belongings inside your home. This includes items like:
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Furniture and curtains
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White goods (fridges, washers, etc.)
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Electronics and appliances (TVs, computers, stereo systems)
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Clothing, footwear, and accessories
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Jewellery and watches
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Toys and sporting equipment
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Mobility aids (e.g. motorised wheelchairs)
It covers belongings owned by you and family members living in your home—but not usually visitors’ property unless specifically named.
🚫 Not included by default:
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Portable valuables outside the home (unless you add extra cover)
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Items permanently attached to the building (e.g. built-in wardrobes)
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Business tools unless listed
🧍♂️ Suitable for Both Homeowners and Renters
Contents insurance isn’t just for homeowners. If you’re renting, your landlord’s insurance won’t cover your possessions—that’s your responsibility. Low-cost renter’s insurance options can give tenants affordable peace of mind.
💎 Types of Contents Insurance: Know the Difference
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New-for-Old Cover
This is the most common option. It replaces lost or damaged items with brand new equivalents—even if your items were older or worn. It typically costs more but offers better protection. -
Replacement Value Cover
This pays out based on an item’s current market value at the time of loss. Since most belongings depreciate over time, the payout could be significantly less than the cost of buying new.
📌 Tip: Whichever option you choose, regularly review your policy and update your contents inventory so you’re not caught short.
📋 What Events Are You Covered For?
Your cover depends on the policy you choose:
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Defined Events policies only cover specific risks like fire or theft.
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Accidental Damage policies offer broader protection, including spills, breakages, and unexpected mishaps around the home.
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Optional Cover: You may be able to add cover for valuables like cameras, mobile phones or sporting gear while they’re outside your home.
💬 Always check limits for specific items—your insurer may cap jewellery claims at $500 unless you’ve listed it separately for full value.
🧾 How to Calculate the Right Level of Cover
Many people underestimate the total value of their belongings. Here’s how to avoid being underinsured:
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Create a home contents inventory—list everything you own and its replacement value.
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Keep receipts, serial numbers, and photos as proof of ownership.
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Update your list annually, especially after major purchases or gifts.
📱 Many insurers offer smartphone apps or online tools to help you catalogue your contents.
Try the Understand Insurance Contents Calculator to get started.
⚠️ What Is Underinsurance and Why Should You Care?
If your insured amount doesn’t match the full value of your belongings, you could be left paying the difference after a claim. This is known as underinsurance, and it’s surprisingly common.
Here’s how it can impact you:
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Total Loss Example:
You insure your contents for $25,000, but a fire destroys $50,000 worth of items. Your insurer will only pay $25,000. -
Partial Loss Example:
You suffer $10,000 worth of damage but are only 50% insured. Your payout may be halved to $5,000.
This is called averaging, and it’s detailed in your policy’s Product Disclosure Statement (PDS). To avoid it, keep your sum insured accurate and current.
💰 What Influences Your Premium?
Insurers calculate your premium based on the likelihood of a future claim. Factors include:
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Sum insured and level of cover
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Age of the policyholder
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Type of property and how it's occupied
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Location (including crime and weather risks)
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Security features (alarms, deadbolts, etc.)
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Home business use
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Excess amount chosen
🎯 Ways to Save on Contents Insurance
Insurers often offer discounts, such as:
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Multi-policy discount (bundle with home or car insurance)
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No-claims bonus
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Long-term customer rewards
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Safety discounts for having fire extinguishers, smoke alarms, or security systems
Check your Certificate of Insurance to see which discounts apply.
🧾 What Else is in Your Premium?
In addition to the insurance premium itself, expect to pay:
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GST (10%)
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State stamp duties (6–11%)
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Emergency Services Levy (NSW only)
These are added automatically by your insurer and detailed in your policy documents.
🛠️ Choosing the Right Cover Is a Smart Move
It’s not just about insuring your stuff—it’s about protecting your lifestyle, your memories, and your ability to bounce back when life doesn’t go to plan. With contents insurance, you’re buying financial stability and peace of mind.
Before you decide:
✅ Create a contents inventory
✅ Compare policies (defined events vs. accidental damage)
✅ Make sure valuable items are listed and valued properly
✅ Review and update your policy every year
