Understanding Home Insurance Policy Benefits – Your Guide to Claiming What You’re Entitled To

If your home is damaged by a storm, fire, flood or other insured event, your insurance policy should cover the cost to put things right. But what exactly does that include? Most people assume it’s just repairs or a payout for what was lost. In reality, home insurance policies often include a wide range of benefits, from temporary accommodation and professional fees to extra allowances you may not even realise exist.

The problem is, insurers don’t always explain these benefits clearly when you make a claim. And unless you know what to ask for, you could end up missing out on thousands of dollars you’re entitled to.

This guide explains:

What your policy might cover as standard, and which extras you need to choose when you buy or renew.
What you can claim after an insured event, including building repairs, contents, accommodation and more.
Common exclusions insurers rely on to reject claims, and how to spot when they’re being misused.
Behaviours to watch out for, like insurers underquoting repairs or offering quick cash payouts that don’t cover the full cost.
What evidence you should gather to support your claim.
The additional compensation you might be entitled to, even if it’s not in your policy, when an insurer delays or mishandles your claim.
Real examples to help you understand how these issues play out in practice.

We’ve written this guide in plain English, with practical examples and clear summaries. By the end, you’ll be better equipped to understand what your policy includes, how to claim everything you’reentitled to, and what to do if things go wrong.

What Are Policy Benefits? (Standard vs Optional Cover)

When you buy home insurance, you’re not just getting cover for repairs or rebuilding. You’re also getting a range of policy benefits – these are the specific things your insurer agrees to pay for if your home is damaged by an insured event like a storm, flood or fire.

Some benefits are included automatically in most home policies. Others are optional and only apply if you chose to add them when you took out or renewed your policy.

Standard benefits usually include:

Repairs or rebuilding if your home is damaged
Temporary accommodation if your home becomes uninhabitable
Removal of debris after a loss
Basic cover for your contents (if you have a home and contents or contents-only policy)

Beyond these basics, many policies include or offer optional extras, which you need to specifically choose and pay for. These vary depending on the insurer, but may include:

Contents cover (if not already included)
Extra cover for high-value items like jewellery or artwork
Pet accommodation if you can’t live at home
Professional fees (such as engineers or architects)
Safety net cover (extra funds if your rebuild goes over budget)
Replacement of locks
Cover for food spoilage after a power outage
Landscaping or garden repairs
Motor burnout (e.g. if your air conditioner breaks due to an electrical fault)

Some insurers include more of these extras by default, especially in higher-tier policies. Others strip them back in cheaper policies or offer them only as add-ons. Two people with “home insurance” from different providers could have very different entitlements. That’s why it’s critical to check your own documents – the Product Disclosure Statement (PDS) explains what events are covered and what benefits apply, and your Certificate of Insurance shows the specific options and limits you selected.

In short, don’t assume something’s covered just because it sounds reasonable. What matters is what your specific policy says, and knowing that before you need to claim makes all the difference.

How to Check Your Policy for Benefits

If you’ve had damage to your home, one of the first questions is: what exactly are you covered for? To find out, you’ll need to look at two documents: your Product Disclosure Statement (PDS) and your Certificate of Insurance (also called a policy schedule).

The PDS is the general guide that outlines all the events, benefits and optional extras the insurer offers – it’s the same for everyone with that policy. The Certificate of Insurance, on the other hand, is specific to you. It shows:

Whether you’ve insured your home, contents, or both
The sum insured for each (the maximum your insurer will pay)
Any extras or optional covers you selected
Special conditions or limits that apply to your policy

For example, your certificate might show:

“Building sum insured: $450,000”
“Contents sum insured: $75,000”
“Flood cover: Yes”
“Specified items: Engagement ring $8,000”

To check what benefits apply, find the section in the PDS that lists standard and optional benefits. Then cross-check your certificate to see which optional extras you actually have. If the PDS mentions something like motor burnout or flood cover as “optional”, your certificate will confirm whether or not it’s included in your cover.

It’s also important to look closely at your sum insured amounts. These are the maximum amounts your insurer will pay if there’s a total loss – and they’re chosen by you, not by the insurer. Many people guess too low, which means they end up underinsured. For your building, make sure the sum insured covers the full cost to rebuild, including demolition and debris removal. For contents, think about what it would cost to replace everything new – most policies are “new for old”, so that’s what you need to budget for.

Insurers won’t tell you how much to insure for, so it’s worth reviewing your cover each year. If you’ve renovated, bought expensive items, or construction costs have gone up, you may need to adjust your sums insured. Making sure your limits are realistic is a key part of making your policy work for you when it matters most.

Examples of Policy Benefits

Home insurance policies generally include a mix of standard benefits (included automatically) and optional benefits (add-ons you pay for). Understanding which is which helps you check if you’ve got the cover you need, and what to claim if something goes wrong.

Standard benefits often include:

Building replacement: covers the cost to repair or rebuild your home if it’s damaged by an insured event, up to your building sum insured.
Contents cover: if included in your policy, this covers your personal belongings such as furniture, appliances, clothing and electronics, up to your contents sum insured.
Temporary accommodation: pays for alternative housing if your home is uninhabitable after an event like a fire or flood. Some policies set a percentage limit (e.g. 10% of the building sum insured), others cover the full reasonable period.
Debris removal and site clearance: includes costs for demolition and clean-up after damage, often with a separate limit in the policy.
Emergency repairs: insurers generally cover urgent repairs needed to prevent further damage (such as tarping a roof or boarding up windows).
Minor additional costs: many policies also include things like lock replacement after a theft, or food spoilage from a power outage, often subject to smaller sub-limits.

Optional benefits (only covered if you selected them) can include:

Higher-value contents cover: covers specific expensive items like jewellery, watches, or artwork. These usually need to be listed separately on your policy to be fully covered.
Accidental damage cover: protects against one-off incidents like spilling paint on carpet or dropping a television. This is often included in top-tier policies or available as an add-on.
Pet accommodation: reimburses boarding costs for pets if you can’t live at home during repairs. Not all policies include this, even at higher levels.
Motor burnout (fusion): covers the cost to repair or replace electrical motors that fail, such as in fridges, air conditioners, or pool pumps.
Flood cover: in some areas, this is not standard and must be added on. It applies to damage from rising rivers, creeks or flash flooding.
Safety net or extended rebuild cover: provides an extra buffer (usually 20–30% of your building sum insured) if the cost to rebuild ends up higher than expected.
Increased temporary accommodation: lets you boost the standard accommodation benefit if you know the default limit won’t be enough for your family’s needs.

Always refer to your Product Disclosure Statement (PDS) and Certificate of Insurance to confirm what applies to your policy. If you’re unsure, contact your insurer and ask: “Does my policy include this benefit, and what is the limit?” Being clear on what you’ve got, and what you don’t, will help you claim everything you’re entitled to.

Building Damage: Rebuilding or Repairing Your Home

After a major event like a storm, cyclone, fire or flood, the biggest part of your insurance claim is usually the damage to your home itself. This includes the cost to repair or rebuild the house and any insured structures.

If you have building insurance, here’s how that benefit typically works:

What’s covered: Your policy usually includes all fixed parts of the home, like walls, floors, ceilings, roof, doors, built-in kitchens and cabinetry, if they’ve been damaged by an insured event. The cover extends to what’s needed to remove, repair or replace those parts so the home is restored to how it was before the damage.
Associated costs: This often includes extra costs like demolition of unsafe sections, site clearing, or even specialist work like mould removal and cleaning if needed before repairs can begin.
New-for-old basis: Most home insurance policies in Australia operate on a “new for old” basis. That means the insurer pays to rebuild using new materials of similar quality – they don’t reduce the payout just because what you lost was old. For example, if you had a 25-year-old kitchen, the insurer pays to replace it with a new kitchen of similar type and standard.
“Like for like” repairs: Insurers are required to restore your home to its pre-damage condition, not upgrade it. You won’t get a luxury kitchen if that’s not what you had, but you also shouldn’t be left with a patch-up job or a downgrade in quality.
When upgrades are covered: Some improvements are required to meet modern building codes or complete the repair safely. For example:
If the roof trusses need to be reinforced under new building standards, the insurer should cover that.
If the walls contained asbestos that now needs replacing with safe materials, that’s included.
If the only way to install a compliant replacement is to change certain design features, that may also be covered.

These upgrades are allowed because they are directly linked to the repair and required to meet legal or safety standards. But if you choose to renovate more extensively or upgrade finishes (for example, replacing laminate with stone benchtops), the insurer pays for the basic repair and you pay the difference.

Evidence you need: To make a claim, you’ll need to show that the damage was caused by an insured event. This can include:
Photos or videos of the damage
Builder, engineer or restorer reports (if you engage your own experts)
News reports or weather data to show when and how the event occurred
Any communication with the insurer about what happened
Emergency repairs: If you need to make the property safe (e.g. put a tarp over the roof), take photos first and then arrange temporary repairs. These costs are usually reimbursed if reasonable.
Burden of proof: You are responsible for showing that damage occurred and was likely caused by an insured event. But if the insurer wants to deny the claim based on an exclusion (like saying the damage was “pre-existing” or caused by poor maintenance), it’s their responsibility to prove it. They must have solid evidence – not just an opinion or assumption.

If the insurer tries to reject part of your claim, ask them to explain which exclusion they’re relying on and what evidence they have to support it. Under industry standards and AFCA guidance, claim decisions should be based on facts – not speculation or guesswork. Being prepared with your own evidence can help ensure you receive the full benefit you’re entitled to.

Temporary Accommodation: What Happens If You Can’t Live at Home?

If your home is so badly damaged that it’s not safe to live in, your insurance policy may cover the cost of temporary accommodation while it’s being repaired or rebuilt. This benefit can be a lifeline – but how much cover you get, and for how long, depends on your policy.

What’s Typically Covered:

Different policies offer temporary accommodation in different ways:

Some give you a dollar limit, like 10–20% of your building sum insured. For example, if your building is insured for $500,000 and your policy allows 10% for temporary accommodation, you’ll have up to $50,000 to use.
Others cover a set time frame, such as up to 12 or 24 months of rent, with or without a dollar cap.
Some comprehensive policies cover the full “reasonable period” it takes to repair or rebuild your home, without a strict time or money limit.

The type of policy you have makes a big difference. If your house takes 18 months to rebuild but your policy only covers 12 months of rent, you may end up paying the shortfall yourself. Knowing your limits upfront helps you plan or negotiate better with your insurer.

What the Accommodation Should Include:
Insurers are generally required to offer accommodation that:

Is similar in standard to your own home (“like for like”)
Suits your family size and specific needs (e.g. pets, kids, medical access, school zones)

For example, if you’re a family of five with a dog, you shouldn’t be placed in a one-bedroom unit that doesn’t allow pets. The accommodation must be safe, practical, and appropriate for daily life. Policies often also cover:

Furniture rental if your belongings were damaged
Utility connection fees
Storage for undamaged items you need to move out

What You Need to Claim:

To claim temporary accommodation, you generally need to show two things:

That your home is uninhabitable – This could be due to fire, flood, or structural damage. If key areas like bathrooms or kitchens are unusable, or there are safety risks like exposed wires or mould, it’s probably uninhabitable. Use photos, builder reports, or expert opinions to show this. If your insurer told you to move out, keep that in writing too.
That your chosen accommodation is reasonable – Keep lease agreements or hotel invoices. Explain why the place suits your needs (e.g. “3-bedroom rental in the same school zone, pet-friendly, similar rent to local market”). If there are medical or disability needs, include a doctor’s note or just a simple explanation.

Common Problems (and What to Do About Them):

The insurer offers a place that doesn’t suit your needs

You might be offered a hotel room for a family of four or an apartment that doesn’t allow pets. Politely push back. Explain why it doesn’t work, for example, “We have two children and a dog, and need at least three bedrooms in our local area.” Support it with evidence if needed (like school addresses or market rental listings). Most policies account for special needs, so put your case in writing.

Short-term fixes instead of stable rentals

Some insurers prefer to approve week-by-week stays or hotels rather than commit to a long-term lease. That might work short term, but it’s not sustainable. If repairs will take months, ask for a longer lease. Get a timeline from your builder and explain: “Repairs are estimated at 9 months – we need a 12-month lease for stability.”

You hit your time or dollar limit

If you’re close to exhausting your accommodation cover and your home still isn’t ready, talk to the insurer early. If delays were caused by the insurer or their builders, ask for an extension. If they refuse, consider lodging a complaint – especially if you’ve been left out of pocket due to something outside your control.

Other Tips:

Keep receipts for extra costs tied to living away from home – furniture hire, utility set-up fees, or extra fuel if you’re travelling further. Some policies reimburse these.
Always put your communications in writing. Explain your needs clearly and keep a log of who said what.
If things break down, escalate your complaint internally or to AFCA. Having a clear paper trail helps your case.

Contents Cover: Claiming for Your Belongings

If you’ve taken out contents insurance – either as part of a home and contents policy or on its own – you can claim for damage or loss to your personal belongings when an insured event like a fire, stormor flood strikes. This often includes your furniture, clothes, appliances, electronics, and other household items. Even theft or vandalism might trigger a contents claim.

But to make sure you get paid fairly, it’s important to understand what counts as contents, how to justify your claim, and what evidence insurers usually ask for.

What Does Contents Insurance Cover?

Contents cover includes things that:

You own,
Are kept at the home, and
Aren’t permanently fixed to the building.

This usually means:

Furniture, like sofas, beds and tables
TVs and electronics
Clothing and shoes
Kitchenware and appliances (as long as they’re not built in)
Toys, books, decor and tools
Sometimes even outdoor items like lawnmowers, barbecues or contents in a shed

Some items are tricky. For example, carpets or blinds might be classified as contents or building depending on the insurer. Always check your PDS to know how your policy treats those items.

Most policies will either:

Repair items (e.g. clean smoke-damaged clothing), or
Replace them with new ones (often “new for old” – meaning they won’t reduce your payout based on the item’s age, unless it’s clothing or linen, which some insurers still depreciate).

Watch for Sub-Limits on Certain Items

Policies often limit how much you can claim for things like:

Jewellery
Artwork
Collectibles
Tools or sporting gear

For example, jewellery might be capped at $2,000 per item – unless you specifically listed and insured it for more. If you had a $10,000 ring and didn’t declare it on your policy, your payout might still be capped at $2,000. These limits are strict, and insurers will usually stick to them during a claim. If you own anything valuable, make sure you’ve insured it separately before disaster strikes.

Some policies also include extra benefits under contents cover, like:

Food spoilage: If a storm cuts power and your freezer full of food goes bad
Pet cover: If you’ve added this option, vet bills for pets injured during an event might be covered

How to Prove Your Contents Claim

Insurers expect you to provide:

An inventory list of what was damaged or lost
Proof you owned the items
A reasonable estimate of what it would cost to replace them

This can feel overwhelming – especially after a disaster – but here’s how to break it down:

Step 1: List what was lost

Go room by room and make a list. You don’t need to itemise every sock, but you can group things like “10 pairs of jeans, 20 shirts” or “30 books, 15 kitchen items.”
List larger items separately (TVs, laptops, lounges, appliances).
Write down how much it would cost to buy a similar item new, today.

Step 2: Provide ownership evidence

Good proof includes:

Receipts or email invoices
Bank or credit card statements
Photos (including social media pics where the item is visible in the background)
Product manuals, serial numbers, or warranty cards
Boxes or accessories (e.g. phone charger shows you had the phone)

If you don’t have receipts, which is common, write a short explanation:

What the item was
When and where you bought it
Roughly what it cost

Insurers understand not everyone keeps paperwork, especially if everything was destroyed. They’ll usually accept reasonable explanations – especially for lower-value or common items.

Step 3: Use photos of the damage

Photos of the burnt-out kitchen or water-logged bedroom help show the extent of loss.
If piles of ruined clothes or books are visible, that backs up your inventory.
For damaged but not destroyed items, photos can help show whether repair is realistic.

Additional Benefits and Entitlements Under Your Policy

In addition to the big-ticket items (building, contents, alternate accommodation), most home insurance policies include a range of additional benefits that can be claimed. These are often listed in a separate section of the PDS (sometimes called “Additional benefits” or “Automatic benefits”) and may be subject to specific limits. They can significantly ease the financial burden of an insured event, but only if you know about them and claim them. Let’s go through key additional benefits:

Debris Removal: Almost every policy covers the cost of removing debris, rubble, and damaged materials from your property after a claim. This is crucial after events like house fires (where there’s a lot of charred debris) or floods (waterlogged debris) or storms (fallen trees, wreckage). Sometimes it’s included as part of your building sum insured, other times it’s an extra amount on top (e.g. up to 10% extra). Check how yours is structured. Make sure your claim includes demolition and cleanup costs. If your insurer’s scope of works is, say, just the rebuild, ensure they’ve accounted for tearing down and carting away the old stuff. If rebuilding costs are hitting your sum insured limit, allocating some costs under debris removal benefit can help extend your coverage. For example, an insurer might agree, “Ok, $20k of that demolition will come under the debris removal benefit, not the main sum insured,” effectively giving you more headroom to complete the rebuild. Don’t leave this money on the table – it’s there for situations exactly like a total loss where debris removal is significant.
Temporary Repairs / Make Safe: Although not always explicitly listed as a benefit, insurers will pay for reasonable temporary measures to prevent further damage or make the property safe. This could include tarping a roof, boarding up broken windows, or hiring a plumber to cap a burst pipe. You don’t usually need pre-approval in an emergency (like stopping a leak), but do notify the insurer as soon as possible. Keep invoices – this is claimable.
Spoiled Food: If an insured event or related power outage causes your refrigerator or freezer contents to spoil, policies often cover reimbursement for the food loss (commonly up to a few hundred dollars). For instance, if a storm knocks out power for two days and you have to throw away $500 of groceries, you can claim that. Insurers may ask for an itemised list of the food or an estimate – be reasonable and they’ll usually pay up to the limit. We’ve even seen lighthearted advice from adjusters like, “take a photo of your full fridge before tossing everything” to validate that you had that much food. If you had a chest freezer full of meat, mention it. This benefit is easy to overlook, but it’s there. Fun fact: One of our team joked about claiming their “pre-made protein shakes” when the fridge died – so yes, even your melted ice cream is worth claiming!
Safety Net (Underinsurance Buffer): Some policies include a “safety net” or “extended cover” which is an extra percentage on top of your building (or sometimes contents) sum insured. For example, a 25% safety net means if your $500k building sum isn’t enough, they’ll pay up to $625k. This is hugely valuable if included (or it might be optional you could have added). If your rebuild quotes are coming in higher than your sum insured, check if you have this benefit. If you do, ensure the insurer factors it in – sometimes the claims handler might forget you had a safety net. You might need to remind them: “My policy has a 25% safety net, so please include that additional amount available for the rebuild”. If you don’t have one and you’re underinsured, unfortunately you’ll be capped at the sum insured (apart from potential avenues via AFCA we discuss later). The safety net, when present, can often cover things like unexpected price hikes in materials or labour (common after natural disasters when building costs surge).
Landscaping and Gardens: Many policies offer a small benefit to cover damaged trees, plants, lawns, or landscaping features. This might be a fixed amount per tree or a total cap (e.g. “up to $2,000 for landscaping”). While this won’t restore a full mature garden, it can help replant some shrubs or fix a damaged fence or retaining wall (if covered at all). Be aware few policies cover earthworks or retaining walls as part of landscaping – often explicitly excluded. And the limits are often quite low (a couple thousand dollars). But if you had an expensive garden feature or fence that is covered, don’t forget to claim it. Example: A storm uproots a tree and wrecks your backyard fence and some rose bushes. If your policy gives $2k for landscaping, you might use that towards tree removal and replanting, while the fence (if considered part of building or separate) might be covered elsewhere. Some policies won’t cover any landscaping unless caused by specific events. Check PDS wording like “We will pay up to $X for loss of plants or trees caused by (storm/fire/etc.)”.
Replacement of Locks: If your house keys are stolen, or you’ve had a break-in, many policies cover the cost of a locksmith to change your locks for security. This benefit often has a limit (commonly $500 to $1000). It’s usually claimable even if there was no other damage – say someone stole your handbag with your keys and address, you can claim lock replacement. Also, after a burglary, even if the door wasn’t damaged, you might feel safer replacing locks – that’s what this is for. Insurers recognize locksmiths are not cheap, so this helps.
Motor Burnout (Fusion): This covers the burning out of electric motors in appliances due to electrical issues. It’s often optional, but if you have it, it means if say your air conditioner’s motor just dies or a power surge during a storm damages your fridge’s compressor, the insurer pays to repair or replace that motor/appliance. Usually the motor has to have failed electrically (not normal wear). If a lightning strike or power surge as part of a storm caused damage, that might actually fall under insured event anyway. Motor burnout cover typically applies to events like an internal short circuit not caused by an external event. There’s often an age limit (e.g. they won’t cover motors older than 10 or 15 years). If you do make a claim under this, evidence might be a technician’s report saying the motor fused. The policy might cover reasonable diagnosis costs too. This is a niche benefit but worth mentioning.
Loss of Rent (Landlord Insurance): For those who have a rental property and insured it accordingly, a standard benefit is loss of rent – if tenants have to move out due to damage, the policy pays the lost rental income during repairs. This is akin to temp accommodation but for landlords. The period and amount are defined (often up to 12 months rent). If you’re a landlord making a building claim, ensure you also claim for loss of rent. You’ll need to show the tenancy agreement and the rent amount.
Professional Fees: Many building policies include coverage for professional fees needed in the rebuilding process. This can include fees for architects, engineers, surveyors, or council building application fees, etc. It’s often capped (commonly around 10% of the building sum insured). For example, if an engineer must certify your foundations or an architect needs to draw plans to rebuild, those costs can be claimed. Make sure the insurer’s scope/budget for your repairs includes these necessary fees. If you hired an engineer yourself to inspect the damage cause (say to prove something to the insurer), that might not automatically fall under this benefit (since it’s more for rebuild planning), but you might seek to have it covered – sometimes insurers will pay it as part of claim investigation, or later you might claim it under AFCA professional fees (discussed later). The key is that you shouldn’t be out-of-pocket for required professional services to get your home fixed.

Again, read your PDS’s additional benefits section to see which of these you have. If an insured event happens, keep these in mind so you don’t forget to claim them. Insurers sometimes won’t mention you have, say, food spoilage cover – you have to bring it up. A quick example: After a cyclone, one family was busy dealing with major house damage. Weeks later, they remembered their freezer full of meat had thawed out and gone off – about $700 worth. They initially forgot to claim it, but when they did, the insurer promptly paid under the food spoilage benefit (it was covered up to $1000). So it’sworth keeping track.

Beyond the Policy: Additional Compensation

Even if you’ve claimed everything under your insurance policy, there may be more you’re entitled to if your insurer caused delays, mishandled your claim, or didn’t act fairly. These extra types of compensation don’t come from your insurance policy – they come through a complaints process with the Australian Financial Complaints Authority (AFCA).

Insurers won’t offer these voluntarily. You usually need to raise a formal complaint, and AFCA can then award these amounts if they think it’s fair. Here’s what to know, in plain terms:

Contingency Allowances (Buffer for Unexpected Costs)

Sometimes extra repair costs pop up once work begins, like hidden mould or damage that wasn’t obvious early on.
AFCA can award an extra 10–20% on top of a quote to cover these “what if” costs.
Insurers will often say “we don’t cover contingencies” and they’re technically right under the policy. But AFCA can allow them anyway.
If you think extra costs are likely (for example, the floor hasn’t been checked yet and could be damaged), explain that in your AFCA complaint. Be reasonable and stick to a fair range – usually 10% unless there’s a clear reason for more.

Tip: Document why a contingency is needed – e.g. builder notes, limitations in access, or price uncertainty all help.

Interest on Delayed Payments

If your insurer delayed paying you when they shouldn’t have, they may owe you interest.
Under the Insurance Contracts Act, this interest is your legal right – it compensates you for being out of pocket.
Common scenarios include:
A claim that was wrongly denied for months before being accepted
Excessive delays in payment after approval
AFCA will calculate the interest amount if they agree it was unreasonable. You don’t need to work it out yourself, but it helps to flag the delay in your complaint.

Tip: Note the dates: when the insurer should have paid and when they actually did. If they dragged things out, you may be owed interest.

Non-Financial Loss (Stress, Inconvenience, Distress)

If the way the insurer handled your claim caused serious stress or disruption to your life, AFCA can award compensation.
This includes situations where:
You were left in poor living conditions for months
You had to move multiple times due to delays
Your health or wellbeing was affected
You won’t get huge sums – this isn’t like a personal injury claim. Most awards range from $500 to $3,000. But it’s recognition of the impact on you and your family.

Tip: Write a personal statement explaining how the delays or treatment affected your day-to-day life. Include details about stress, anxiety, illness, or disruption to work or school.

Financial Losses Due to the Insurer’s Conduct

If the insurer’s actions (or inaction) caused you to lose money beyond your policy cover, AFCA can require them to pay that too.
Examples include:
Extra damage from delays (e.g. insurer didn’t tarp your roof and more water got in)
Costs you had to cover yourself because the insurer was too slow (like hiring pumps, paying rent when your limit ran out, or replacing things they let get worse)
You must prove the extra loss was caused by the insurer – not just bad luck or other factors.

Tip: Keep receipts for everything you had to pay for. If you warned the insurer in writing and they failed to act, include that too. It helps show the loss could have been avoided.

Professional Fees (Cost of Getting Expert Help)

If you had to pay for expert reports, builders, engineers, or legal advice because the insurer wasn’t handling your claim properly, AFCA can award up to $5,000 to reimburse you.
This applies if the help you paid for made a real difference, for example, if a report you commissioned helped overturn a denial.
It also covers fees for claims advocates or adjusters (up to the cap), if you used one because you couldn’t get a fair response on your own.

Tip: Keep records of what you paid and why. Explain in your complaint how that help led to a better outcome (e.g. “The engineer’s report proved the roof damage was storm-related and the insurer then changed their decision.”)

Why This Matters

These extra types of compensation exist to ensure insurers are held accountable for how they treat people. They’re not automatic, but if your experience involved delays, stress, or poor treatment, you can include them when you raise a complaint with AFCA.

Most insurers won’t agree to any of this unless you escalate. But once a case is at AFCA, they often offer to settle with a bit extra to avoid a formal ruling. Knowing what to ask for gives you leverageand can lead to a better outcome.

Final Tips:

Keep everything in writing – emails, notes from phone calls, receipts, and personal records.
Be clear, factual, and polite in your complaint.
Don’t overstate things, but don’t undersell the impact either – be honest about what happened and how it affected you.

These remedies exist to level the playing field. If you’ve been let down by the process, don’t hesitate to ask for a fair go.

Common Problems (and How to Navigate Them)

Building damage claims can quickly become contentious. Here are the most common issues homeowners face and how to respond effectively.

Pre-Existing Damage or “Not Related to the Event”

Insurers often argue that the damage you’re claiming was already there or caused by something else. This is especially common with water damage or roof leaks.

Insurers may say storm-related damage is actually due to “wear and tear” or “maintenance issues.”
They might focus on unrelated issues (e.g. a small shower leak) to avoid covering broader damage.
Tactics can include:
Sending leak detection plumbers to find long-term water ingress.
Using flood tests on showers to trigger standard exclusions.
Highlighting minor rust or hairline cracks as signs of prior damage.

What to do:

Don’t accept a denial without evidence. Ask for the expert reports or photos your insurer relied on.
Make sure they’ve considered the timing of the damage. If the problem didn’t exist before the storm or fire, push back.
Gather your own evidence, including builder or engineer reports.
Remind the insurer that if they’re relying on an exclusion, they must prove it. The burden of proof is on them.
Challenge far-fetched claims (e.g. a leaking shower causing roof collapse) with logic and documented history.
You are not required to have a perfect home to be insured. The insurer can’t deny damage caused by an event just because part of your home was older or slightly worn.

Underscoped or Underquoted Repairs

Sometimes the insurer’s builder prepares a repair scope that misses key items or uses unrealistically low pricing.

This might be due to rushed inspections or cost-saving tactics after a widespread disaster.
You may receive a cash offer based on this limited scope, which could leave you with a shortfall.

What to do:

Request a copy of the insurer’s repair scope and quote breakdown.
Get your own independent quote from a licensed builder for the same work.
Make sure your builder quotes “like for like” and complies with current building codes.
If your builder’s quote is higher, send it to the insurer and request a revised offer.
If the insurer says your quote is “excessive,” ask for a detailed explanation, not just a dismissal.
Use the complaints process if needed. Escalating to AFCA often results in improved offers.
Document the differences between scopes – line by line – to clearly show what was missed.

Cash Settlement to Avoid Repair Responsibility

Sometimes insurers prefer to offer a cash payout instead of managing the repairs themselves.

This can happen after large catastrophes, or if the insurer doesn’t want to be liable for the repair outcome.
They may cite unrelated issues (e.g. a foundation crack) as a reason to walk away.

What to do:

Assess whether the payout truly covers the full cost to restore your home.
Remember: a cash settlement must reflect what you would pay a builder, not what the insurer would pay with discounts.
Ask the insurer to specify what the payout covers, and what it excludes.
If they cite a pre-existing issue, make sure the cash offer covers the rest of the repair in full.
Consider whether you’d prefer insurer-managed repairs (as the insurer remains responsible for defects).

Disputes About Necessary vs Optional Repairs

Insurers may argue that certain parts of the job aren’t “necessary” or weren’t caused by the event.

Common examples:
Refusing to investigate potential mould behind a damaged wall.
Only fixing a section of a damaged fence instead of the entire structure.
Disputing the need for internal drying or engineering reports.

What to do:

Ask the insurer to explain, in writing, why certain works are excluded.
Provide expert reports or opinions if needed to show why the works are essential.
Emphasise safety, completeness, and code compliance.
Escalate the dispute if the insurer refuses to cover something clearly related.

Excluded Structures (Retaining Walls, Pools, Carpets)

Many home insurance policies exclude or restrict cover for certain parts of your property.

Retaining walls are often completely excluded or only partially covered.
Swimming pools and their liners may be limited in coverage.
Fixed carpets, blinds, or fittings are sometimes classified as contents (not building), so you may not be covered if you don’t have contents insurance.

What to do:

Read your policy carefully to see how these items are treated.
If they’re important to your property, consider adding them via a special endorsement or upgrading your policy.
During a claim, clarify how the insurer has categorised the item – and challenge it if necessary.

Final Tips

Always ask the insurer for the factual basis of any claim denial or reduced scope. Make them explain their position.
Document everything, including emails, phone calls, reports, and photographs.
If you feel your claim is being mishandled or lowballed, don’t hesitate to lodge a formal complaint.
Seek independent expert advice if needed – in many cases, you can recover the cost later.
If the internal process stalls, escalate to AFCA. A clear paper trail and evidence-based case gives you a strong footing.
If you need assistance, Claims Hero specialises in understanding policy benefits and advocating on your behalf.

Navigating these problems can be challenging, but being informed and assertive makes a real difference. Don’t settle for less than what your policy entitles you to.

Disclaimer

This blog provides general information only and is not intended to constitute financial, legal, or personal advice. It does not take into account your specific circumstances, objectives, or needs. You should review your own insurance policy documents carefully and seek independent advice before making any decisions about your insurance claim or dispute.