How do I calculate my building replacement cost?

Multiply your floor area (sqm) by the cost per sqm for your build quality: Basic $1,800-$2,200, Standard $2,200-$2,800, Premium $2,800-$3,500, Luxury $3,500-$5,000+. Then add 10-15% for demolition, temporary accommodation, and compliance with current building codes. You can also use free online calculators from major insurers or get a professional valuation.

Does home insurance cover flood?

Not always. Since 2012, insurers must clearly state whether flood is covered. Many policies in flood-prone areas either exclude flood, offer it as optional extra, or include it at a much higher premium. Check your PDS carefully for the definition of 'flood' vs 'storm damage' — they're different events with different cover.

What does contents insurance actually cover?

Contents insurance typically covers: furniture, appliances, electronics, clothing, linen, kitchenware, personal items, tools, and sometimes portable items taken outside the home. High-value items (over $2,000-$5,000 each) usually need to be listed individually. Contents in garages and sheds are also covered (check limits). Most policies are 'new for old' — meaning they pay to replace with a new item, not a secondhand one.

Home & Contents Insurance Calculator

Calculator

Estimate the right level of home and contents insurance cover. Calculate your building replacement cost and contents value to avoid being underinsured.

Free to useNo data storedAI insightsUpdated: February 2026

Most Australians are underinsured on their home by $50,000-$200,000 — meaning if your house burned down, the insurance payout wouldn't cover the full cost to rebuild. Building costs have surged 20-30% since 2020, and many policies haven't kept up. Contents insurance is also commonly underestimated — the average Australian household has $70,000-$100,000 worth of belongings. This calculator helps you estimate the correct level of cover so you're not caught short when you need it most.

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Real-World Examples

Typical 3-Bedroom House

A 2015-built, 180sqm, medium-quality 3-bedroom house in suburban Melbourne. Contents estimated at $85,000.

Building replacement estimate: 180sqm × $2,800/sqm = $504,000. Add demolition ($25,000), temporary accommodation, and council compliance ($30,000). Total building cover recommended: ~$560,000. Contents: $85,000. Annual premium estimate: $1,800-$2,500 (low-risk area).

Renter in Sydney Apartment

A couple renting a 2-bedroom apartment with furniture, electronics, clothing, and $8,000 in jewellery.

Contents estimate: furniture $12,000, electronics $6,000, clothing $10,000, kitchen $4,000, other $8,000 = $40,000 base. Plus jewellery $8,000 (listed separately). Contents cover: $48,000. Premium estimate: $400-$700/year. Without insurance, a theft or fire would cost them $48,000 out of pocket.

Frequently Asked Questions

Glossary

Building Insurance

Covers the physical structure of your home — walls, roof, floors, and fixed structures (built-in wardrobes, kitchen, bathroom). Does NOT cover the land or contents.

Contents Insurance

Covers personal belongings inside your home — furniture, electronics, clothing, appliances. Typically covers theft, fire, storm damage, and accidental damage (if included).

Replacement Cost

The cost to rebuild the home or replace contents with new items of similar quality. Different from market value or depreciated value.

Sum Insured vs Total Replacement

Sum insured: a fixed dollar limit on payouts. Total replacement: the insurer pays whatever it costs to rebuild/replace, with no cap. Total replacement offers more protection.

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Home Loan Calculator

Building insurance is required by your mortgage lender.

How to Use

1Select your property type and enter the building size.
2Choose the building age and quality of finishes.
3Estimate the total replacement value of your contents.
4Add any high-value items (jewellery, art, collections).
5Select your location risk level.
6Choose whether you need building, contents, or both.

Key Information

Building replacement cost is NOT the same as market value. Replacement cost = what it costs to rebuild the structure from scratch.
Rebuild costs vary from $1,800/sqm (basic) to $4,000+/sqm (premium/architect). National average is ~$2,400-$3,000/sqm.
Contents insurance covers replacement value (what it costs to buy new) NOT current/secondhand value.
Policies typically have per-item limits ($2,000-$5,000) for unspecified items. High-value items need to be listed separately.

Pro Tips

Walk through every room and photograph your belongings — this inventory is invaluable for claims and helps you estimate contents value accurately.
Update your building cover annually — construction costs are rising faster than inflation. What was adequate 3 years ago may be $100,000 short today.
List high-value items (jewellery, watches, cameras, instruments) individually on your policy — standard per-item limits often don't cover these.
Consider 'total replacement' or 'new for old' cover rather than 'market value' — it ensures you can replace worn items with new ones.

Avoid These Mistakes

Using the property's market value as the building cover — market value includes land. Rebuild cost is JUST the structure and can be higher or lower than market value.
Underestimating contents value — add up every room: bedroom furniture $5,000-$15,000, kitchen appliances $3,000-$8,000, electronics $2,000-$10,000, clothing $5,000-$15,000 per person.
Not checking flood cover — many 'comprehensive' policies DON'T include flood. In flood-prone areas, it's either excluded or very expensive.
Choosing the cheapest policy without reading what's excluded — a $200 saving on premium means nothing if a $200,000 claim is denied.

Disclaimer: This calculator provides estimates only and should not be relied upon for financial decisions. Interest rates, fees, and policies change frequently. Always verify information with lenders directly. This is general information, not personal financial advice. Consider seeking advice from a licensed mortgage broker or financial advisor.

Last updated: February 2026