Why do home insurance premiums change?
We want you to feel informed about the reasons behind changes to your Home Insurance premium. That’s why we’ve broken down some of the common factors that affect pricing and how you can consider checking if the coverage is right for you.
What impacts premium?
The below information is relevant to AAMI home and/or contents (including fire and theft contents), landlord and strata insurance (unless otherwise stated). Please refer to your relevant policy documents for more detail.
Many factors can impact the amount of premium that we charge our customers, some key matters are set out below. In addition to change in circumstances impacting your cover, premiums are also impacted by changes in our pricing practice, pricing factors and how we calculate premium from time to time.
Sum insured is the most you can claim for any one incident unless stated otherwise in your relevant PDS. Repairs on high value homes also tend to cost more often due to the quality of fixtures and fittings in the home, resulting in higher premiums.
In some areas of Australia, natural disasters or severe weather events can happen more often and therefore, location can impact the premium more substantively. Certain areas with higher risk of theft, vandalism and other similar incidents will also affect the premium.
The materials used to build a home will affect the premium charged, in particular, the roof and wall materials as these are what protects a home from outside elements.
Excess is the amount you ordinarily have to pay for each incident when you make a claim. If you choose a higher excess, you may be out of pocket more when making a claim. A higher excess reduces our claims cost meaning we can reduce your premium. Higher excess means a lower premium, lower excess means a higher premium.
A premium may change depending on the total amount of claims we receive each year. If we receive more claims than expected, premiums can be impacted.
Should you choose to pay monthly instalments, a higher premium is usually charged. When your premiums are paid upfront annually it is cheaper than paying by monthly instalments.
After we have calculated the amount to cover your insurance policy any applicable stamp duty, GST, charge and levy are then applied. Government taxes and charges may change from time to time.
How can I review my premium?
The below general information is relevant to AAMI home and/or contents (including fire and theft contents), landlord and strata insurance (unless otherwise stated). Please refer to your relevant policy documents for more detail.
Review your policies to make sure all details are correct. Some changes can impact your premium if they affect the premium factors. Below are some ways you can influence how much premium you pay under our suite of AAMI home products where relevant. When reviewing your policy, you should always consider your own personal circumstances and check whether your policy suits your own needs.
If you add this optional cover, this will also influence the premium charged. Our Complete Replacement Cover is an optional cover that can be added to your home and landlord insurance policies. This level of cover can give you peace of mind that we'll repair or rebuild your home as it was or pay you the amount of the assessed quote to do so without you having to set a specific sum insured limit. We provide you peace of mind if you're uncertain as to how much it will cost to rebuild your home.
Where you choose to set your sum insured, the amount you select will also influence your premium.
On renewal we also consider a range of factors that can influence the cost to rebuild the building and may choose to adjust the building sum insured shown on your certificate of insurance at the end of each period of insurance. This is to account for various factors including inflationary trends. However, at each renewal, you need to consider if the level of sum insured is sufficient for your situation and contact us if it is not appropriate.
If you insure both your building and contents together with us for the same address on the same policy with us, you can save up to 10%. This discount is only applicable to AAMI Home Building Insurance and Home Contents Insurance products.
If you are eligible for more than one discount, we usually apply any subsequent discount to the already discounted premium.
Discounts are also a factor that can affect your premium. The premium you pay for your insurance includes any discounts we have given you. Any discounts are usually calculated and applied before the application of government taxes and charges.
You should check your relevant policy documentation for information on discounts.
From time to time we might also offer discounts or some other special offer as part of a marketing campaign. If we do this, separate terms and conditions will usually apply. The amount and type of discounts that may be offered can change or be withdrawn.
If you are eligible for more than one discount, we usually apply any subsequent discount to the already discounted premium.
To make changes to your policy, log in online to your account to update the changes or give us a call on 13 22 44. Online changes are not available for strata insurance.
Disclaimers:
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.
The information provided is accurate and true as of 7th September 2023, noting we may change our pricing practice (and the premium factors) from time to time.
AAMI Home Building and Home Contents Insurance, Fire and Theft Contents Insurance, Landlord Insurance and Strata Insurance, are issued by AAI Limited ABN 48 005 297 807 trading as AAMI. Read the relevant Product Disclosure Statement or Policy Document before buying this insurance. The Target Market Determination is also available. This advice has been prepared without taking into account any person’s particular objectives, financial situation or needs, so you should consider whether it is appropriate for you before acting on it.