Buying a home
When do you need to insure your new home?
19 December 2019
You’ve done the hard work and you’re finally ready to buy your new home. Often, building insurance is a requirement of lenders (it’s a very good idea to have, regardless). But the question of when you need to have your building insurance sorted has proved to be a murky one. Is it by settlement? Or when you sign the contract?
The answer can depend on the state or territory where you live. It also depends on your contract. There can be a lack of specific legislation in certain states, so the information we’ve put together here is based on commonly used standard contracts. But, at the end of the day, whatever the buyer and seller agree upon and sign their names to is usually the ultimate decider.
When to take out home insurance
Queensland
You’ll need to talk to your solicitor or agent about when you become responsible for a home. But in Queensland the buyer generally becomes responsible from 5pm the next business day after both parties have signed the contract.
Therefore, if there’s damage to the property after 5pm the next business, the buyer is responsible for covering that damage.
Find out more from the Queensland Government.
Explore Home and Contents Insurance options
New South Wales and Victoria
Unlike Queensland, in Victoria and New South Wales the buyer becomes responsible for any damage on the settlement date. Technically, the property is the responsibility of the seller up until settlement date.
While it’s not legally required, your mortgage lender may expect you to take out insurance before settlement.
Of course, the property needs to be handed over in the same condition as when it was sold (except for normal wear and tear). If you find that the condition of the property has changed since settlement, you can ask for a repair. That’s what pre-settlement inspections are for! It’s important to go through your contract and check everything is in the right condition. Don’t feel pressured to sign settlement documents without consulting your solicitor or conveyancer first.
Found out more about Victorian and New South Wales insurance rules.
Video: 7 Home and Contents Insurance tips
Meet Liam and Nayana. They’ve just purchased their first home, so they’re looking into home and contents insurance.
We’ve got you covered with our top tips that every home insurance customer should know!
Let’s start with security: while home insurance gives you peace of mind if something goes wrong, prevention is always better than cure.
Keep your house safe and secure by checking your fire alarm regularly,
locking windows and doors when you’re out,
and consider installing a security alarm.
Keeping your home and your contents safe can also help keep you and your family safe!
Did you know choosing a higher excess will lower your premium? While the thought of paying a higher excess may sound painful, it’ll trim the cost of your insurance policy.
You just need to be prepared to pay the higher excess at claims time
Don’t be caught out with underinsurance! Lowering how much you’re insured for to enjoy cheaper premiums may seem attractive….
….but if you’re underinsured, you might not be adequately covered in the event of a claim.
You’ll also need a plan that’s right for your situation – if you live in a flood-prone area, you’ll probably want cover for flood!
Suncorp Home and Contents Insurance provides cover for your home and its contents for a wide range of risks, including fire, theft, flood, and storm.
Suncorp Insurance offers a discount on Home and Contents Insurance when you get a quote and buy online.
Paying the annual sum of your premium will be cheaper compared to paying it monthly
If you combine three or more eligible Suncorp Insurance policies, you’ll receive a 15% Multi Policy discount!
When it comes to getting cover for your home and contents, consider Suncorp Insurance.
Learn more about our Multi-Policy Discount including terms, conditions and exclusions
Tasmania, Australian Capital Territory and South Australia
The responsibility usually lies on the buyer, as opposed to the seller, during the settlement period in South Australia, Tasmania, and the Australian Capital Territory.
In these states (and territory) the buyer becomes responsible for any damage to the property on the exchange of contracts. So as the purchaser, it’s especially important to get your building insurance sorted before the contract date.
Western Australia and Northern Territory
In the Northern Territory and Western Australia, the buyer becomes responsible for the property on either the date the buyer is entitled to or given possession of the property or the date the whole of the purchase price is paid (the earlier of the two).
Organising insurance probably isn’t the most exciting part of buying a home. Imagining where your furniture will go, deciding who gets what room, and turning a house into a home are a little more exciting.
But getting in early and organising your insurance could help prevent any of your home-owning dreams from coming crashing down.
Whether or not you buy insurance when you are legally required to or earlier is essentially about how much risk you’re willing to take. In the grand scheme of things, the cost of a few extra weeks of home and contents insurance might be worth it for your peace of mind. Just remember to make sure you know what your policy does and doesn’t cover.
Read more:
Insurance is issued by AAI Limited ABN 48 005 297 807 trading as Suncorp Insurance. Read the Product Disclosure Statement before buying this insurance. The Target Market Determination (TMD) is also available. 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.
The information is intended to be of general nature only. Subject to any rights you may have under any law, we do not accept any legal responsibility for any loss or damage, including loss of business or profits or any other indirect loss, incurred as a result of reliance upon the information. Please make your own enquiries.
