When we think about protecting our homes, insurance often feels like a “set and forget” item on the list. But with rising construction costs, more frequent natural disasters, and changing building codes, many Brisbane homeowners may be unknowingly underinsured – and that could prove costly.
So, what exactly is underinsurance? It’s when your insurance cover doesn’t reflect the true cost of rebuilding your home. The Insurance Council of Australia defines it as having cover that’s less than 90% of your home’s replacement value. If your property suffers serious damage, being underinsured could mean you’re left footing a large portion of the repair or rebuild bill.
Why it’s a growing concern in Brisbane
With the rising frequency of storms and floods across Southeast Queensland, homeowners are facing growing risks – and rebuilding costs aren’t what they used to be. Materials are more expensive, trades are in high demand, and post-disaster surges often inflate prices even further.
Here in Brisbane, where property values remain strong and natural events are part of life, it’s crucial that your insurance reflects the cost to rebuild, not just the market value of your home. Add in inflation and stricter building regulations, and it’s easy to see how policies can quickly fall behind.
What homeowners should consider
1. Revisit your policy details:
Don’t assume storm, flood or accidental damage is automatically covered. Carefully read the Product Disclosure Statement (PDS) and check if you’ve opted in to any necessary extras.
2. Understand the real rebuild cost:
Talk to your insurer or a quantity surveyor to estimate the actual cost to rebuild – this includes site clean-up, architect fees, and updated compliance costs.
3. Review your policy annually:
Construction prices and council requirements change regularly. Set a yearly reminder to reassess your coverage to keep pace with market shifts.
4. Prepare for disaster seasons:
Taking visible steps to prepare – like securing loose items, keeping gutters clear, or installing stormwater protection – can help reduce risk and, in some cases, your premium.
5. Know the risk of being caught short:
Being underinsured by even 5% may reduce your payout in a claim. And if you’re below the 80–90% threshold, your insurer might ask you to cover part of the damage costs yourself.
Don’t wait for a claim to find out
Most underinsurance is discovered only when it’s too late – at the worst possible time. A small annual check-in could save you thousands and spare you the stress of being caught out after a damaging storm or accident.
