Whether it’s moving out on your own, buying your first property or finally taking the plunge and purchasing something you’ve been saving hard for, the decision to take out home insurance can be sparked by a number of milestones.
Maybe you’ve bought a new appliance with all the bells and whistles or a top-of-the-range mountain bike to enjoy adventures off the beaten track. Or perhaps you just got engaged and have a beautiful new piece of jewellery to mark the occasion.
Amongst the well-deserved excitement, it can also pay to be practical – and protecting the things that matter to you most is what contents insurance is all about.1
At Youi, our Contents insurance will cover your belongings against theft, as well as loss or damage caused by other scenarios. This can include natural disasters such as bushfire, storm and flood,2 which the CSIRO’s latest State of the Climate report suggests are on the rise in Australia.3
So, do you need contents insurance? If you haven’t owned a policy before, the following information may help you decide.
Life events that make contents insurance worth thinking about
When you’re considering protecting your property, it helps to understand the difference between buildings and contents insurance. This can make it easier to work out whether contents-only insurance is right for you or whether you also need to think about buildings insurance.
Here are some common events that could trigger your decision to insure:
You’re moving out of home
A recent Australian Institute of Family Studies report shows more young adults are continuing to live with their parents rather than moving into rental properties, even into their early thirties.4 Regardless of when it happens, leaving home for the first time is always a big step.
If you’re moving out and your belongings were insured under a parent’s policy – or even if they weren’t and you’d like them to be insured in the place you’re moving to – you’ll need to think about getting your own contents insurance.1
Youi’s Contents insurance includes up to 14 days of cover while you move,2 giving you a bit of breathing space while you get set up.
“This 14-day bridging cover even applies, for example, to a young adult moving out of home where their parents have a Youi policy,” says Mervyn Hartley, Youi’s Head of Product for Home Insurance.
“Beyond this, they can speak to Youi about getting their own policy.”
You’ve bought your first house
Congratulations! And if you used the Home Guarantee Scheme to do it, you’re in good company. A federal government initiative administered by Housing Australia, the scheme supported one in three first-home buyers in 2023-24.5
“Amidst rising living costs and housing affordability challenges, the Home Guarantee Scheme has supported thousands of eligible home buyers to navigate the market and achieve home ownership sooner,” says Jennifer Chew, Chief Program Officer of Home Ownership at Housing Australia.5
So, do you need contents insurance when you’re buying a house? While some mortgage lenders require home buyers to take out building insurance,6 the same doesn’t apply to contents insurance.
However, contents insurance could be a worthwhile investment anyway, as it will help protect the belongings that make your first house a home.
You’ve bought something valuable
If you want to protect a prized possession, such as a new engagement ring or bike, against loss or damage and you don’t have contents insurance in place, now might be a good time to consider it.1
Bear in mind, too, that valuable items such as jewellery often need to be specified on a contents insurance policy. Youi’s Contents insurance requires any items, including jewellery, that are worth more than $15,000 to be specified and assigned a specific value to ensure they’re adequately covered. You can then simply nominate a total sum insured for all your other jewellery.2
It can also be worth thinking about adding cover for accidental damage or loss, particularly if you regularly leave home with your valuable item. At Youi, this is available as optional cover.2
“If you need the additional peace of mind of knowing these valuables are covered away from home as well – worldwide, in fact – you can elect to add the contents accidental loss or damage option for them,” says Hartley.
You’re moving house
If you’re changing address, should you buy contents insurance before moving to your new place?
“At Youi, when you move to a new permanent address, you will need to start a new policy to match that new address, regardless of whether you’ll be living with the same people at that new address or not,” says Hartley.
“But, if you already have a Youi Contents policy at your current address, included are the extra cover benefits of cover while you move, as well as contents in transit, which is for when the contents are inside the removalists’ vehicle which is then involved in a motor accident.”
Hartley adds that you could consider adding cover for accidental loss or damage to the policy as well, even just for the period you’re making the move. He explains that this extends your coverage to include accidental breakage at and away from your home.
“Moving can be a stressful time for anyone, and everyone has their own needs. So, whether you already have a Youi policy or not, speak with one of our advisors to explore what policy options may work for you.”
How much contents insurance do I need?
The first step in figuring out how much insurance you need is working out how much your belongings would cost to replace to avoid being underinsured.
“When you’re doing that, remember to base your figures on today’s prices,” says Hartley, “because a contents policy will typically be new-for-old.”
This means your insurer will cover the cost to repair or replace your belongings with brand-new items, which will often be more than what you paid when you purchased them.1
“It might surprise you how quickly things add up,” Hartley adds. He suggests choosing a sum insured amount that reflects the new replacement value of your contents.
Whenever it’s time to think about getting contents insurance, you might want a policy that’s a bit more you-shaped. To find out whether we’re the right fit for you, start a quote with Youi.
1 Source: Moneysmart – Contents insurance
2 Exclusions, limits and additional fees may apply. See our Home & Contents PDS for full details.
3 Source: CSIRO – Future climate, November 2022
4 Source: Australian Institute of Family Studies – Young people living with parents, June 2023
5 Source: Housing Australia – 1 in 3 first home buyers assisted by the Australian Government’s Home Guarantee Scheme, September 2024
6 Source: Canstar – What does building insurance cover?, March 2024
