Taking out insurance when purchasing a property

If you’re looking to purchase a property or have just bought one, you’ll want to make sure you’ve ticked all the boxes and you’re comprehensively covered before you start moving in.

Before you sign the papers to your new home, you would calculate the costs of all the finer details – there’s the deposit amount, building inspections and conveyancing fees, just to name a few. But if you’re making the decision to spend a chunk of your life savings on a home, making sure you protect your valuable asset with the right kind of cover is critical for your long-term financial security.

Some lenders may insist on proof of insurance as a condition of your home loan. Have a chat to your mortgage broker or home loan specialist if you’re not sure whether this applies to you, and even if insurance isn’t a requirement, it’s always a good idea as it assures peace of mind.

When do I need to take out insurance?

The seller is responsible for insuring the property up until the property settlement date. After you sign the contract but before you take possession on the settlement date, the seller is responsible for maintaining the property. If you organise for a pre-settlement inspection and discover that the house has been damaged since signing the contract, you may be able to reduce the amount of settlement to allow for the cost of repairs or you may be able to have the agreement declared void.

There’s no guarantee that the seller will maintain their insurance through to the settlement date, and if the damage is severe enough to make the contract invalid, you may have to start the house hunting process over again.

Although you’re not obliged to organise Home & Contents Insurance before your settlement date, this is just one of the reasons why you most definitely should consider getting insurance from the date of signing the contract.

Types of property insurance

Building insurance

Building Insurance protects the actual building of your home for all sorts of accidental damage and legal liability. It covers both the dwelling you live in, plus any other buildings on your property – like sheds, carports and garages. From the day that your contracts are exchanged, you should consider taking out building insurance, ensuring that before settlement you have your building insurance sorted.

Contents Insurance

Contents Insurance is exactly what it sounds like – cover for contents and valuables in or around your home. In case your valuables are damaged in an unexpected event, or your home is broken into and your precious possessions get stolen, contents insurance steps in to cover you financially for your loss.

Building and Contents Insurance

Building and Contents Insurance is one of the most popular types of home insurance. This is because it provides cover for both your home and the many things inside it. While considering the dates from which you’ll require them, you may think about purchasing them separately. Do your research because you might get a better deal if you take out a combined Home and Contents Insurance policy.

It’s important to carefully consider what insurance policies you need to protect what’s undoubtedly one of your most valuable possessions. If you would like to know more, speak to our team today on 1300 654 166 or visit Home & Contents Insurance.

Important Information
Standard underwriting criteria and policy terms and conditions apply. Insurance issued by Insurance Australia Limited ABN 11 000 016 722, AFSL 227681 trading as CGU Insurance (CGU). In arranging this insurance, Victoria Teachers Limited ABN 44 087 651 769 AFSL 240960 trading as Bank First (Bank First), acts under its own AFSL and under an agreement with CGU, not as your agent. Bank First receives commission when selling CGU insurance products. Please refer to Bank First’s Financial Services Guide (FSG) for details of these commissions. Any advice is general only. This information does not take into consideration your objectives, financial situation or needs. Therefore, you should firstly consider the appropriateness of this information and refer to the relevant Product Disclosure Statement (PDS) before acquiring a product, available by calling 1300 654 166, visiting a branch or by visiting Bank First’s website.