First home, family home, investment property – whichever rung of the property ladder you’re on, home insurance is there to cover your valuable asset.1 But with premiums on the rise,2 it’s understandable that the cost of that cover might be front of mind for many Aussies researching home insurance options.
For context, the average home insurance cost for a combined building and contents policy in Australia climbed by $343, a rise of 14%, in 2025, compared to national averages in 2024.3
“A single national ‘average’ doesn’t tell the full story though,” says Mervyn Hartley, Youi’s Head of Product – Home Insurance.
“What you might actually pay for your insurance can vary a lot due to a range of factors, including where you live, what your home would cost to rebuild, and the level of cover you choose. For anyone comparing home insurance policies in 2026, understanding why premiums differ can be just as important as the price itself.”
So, how much does home and contents insurance cost in your state or territory? What’s driving the recent increases? And what can homeowners do to help reduce their premiums?
You can find out the answers to these questions and more in this guide to the average cost of home and contents insurance in Australia. And to help you make more informed comparisons when choosing home insurance cover, we also explain how insurers assess risk and which factors may influence your premium the most.
How much does home insurance cost in Australia?
Before we dive into cost, it’s important to understand the different types of home insurance and the language commonly used to refer to them. In Australia, “building insurance” and “home insurance” are often used interchangeably – but they don’t always refer to the same type of cover.
Most home insurance policies are one of these three types:
- Building insurance. This relates to the physical structure of your property,4 and might typically cover damage from events such as flood, fire, storm, theft, earthquake and vandalism.4
- Contents insurance. This covers your household items and personal belongings, such as furniture, electronics and clothes inside the home, and may apply to damage from a range of events including flood, fire, storm, theft, earthquake and malicious damage.5 It’s sometimes called contents-only cover.
- Building and contents insurance. This policy bundles both cover types together.6
“At Youi, ‘home insurance’ refers to buildings and contents insurance,” says Hartley. “And within that product category, we also offer more specialist cover, such as insurance suitable for landlords or renters.”
Average home and contents insurance cost by state and territory
So, what is the cost of home insurance across Australia? We’ve broken it down in the table below.7
| State or territory | Cheapest average premium | Most expensive average premium |
| Australian Capital Territory | $2,1677 | $4,6127 |
| New South Wales | $3,0667 | $6,8307 |
| Northern Territory | $3,5057 | $6,6327 |
| North Queensland | $3,2817 | $7,1017 |
| South Queensland | $2,5907 | $5,7377 |
| South Australia | $1,4807 | $2,9337 |
| Tasmania | $1,8637 | $3,7517 |
| Victoria | $2,1077 | $4,3357 |
| Western Australia | $1,5847 | $3,5397 |
*Average premiums based on a market-representative sample of 152,915 quotes for building and contents insurance, across multiple insurers with an excess as near as possible to $1,000, collected in April 2026 by CHOICE.7
**Queensland data is divided at the Tropic of Capricorn.7
How much should my home insurance cost?
“State and territory averages can give a good ballpark, but they don’t necessarily reflect what an individual in those areas might pay,” says Hartley.
So, how is your home insurance premium calculated? Here are some factors that might impact your home insurance costs.
Location and risk
One factor that can impact your premium is where you live or where your property is located.3
“If the property is located in a suburb with a high crime rate or an area at risk of flood, storm or other natural disasters, it may impact your risk profile, which is something insurers use to estimate how likely you are to make an insurance claim,” explains Hartley.
To calculate risk, insurers may also look at the characteristics of the home, such as the age of your roof and the materials used to build your home, and whether you have a security system.3 Having a lower risk could translate to a cheaper premium.8
Rebuild and replacement costs
“Insurers typically also consider how much your home and contents would cost to rebuild or replace,” says Hartley.
Most Australian insurers offer sum insured policies, which require you to nominate your insured amount for your home and contents yourself.9 Choosing an amount that doesn’t accurately reflect your home’s worth could potentially leave you at risk of being underinsured,9 so it’s a good idea to look into how to work out rebuild costs for home insurance and replacement costs for your contents, before finalising any home insurance policy.
Reasons for underinsurance can include:10
- Uninformed sum insured estimates
- Not accounting for upgrades, such as renovations or new appliances
- Failing to account for rising building costs
- Not considering other rebuilding costs, such as demolition, clean-up and temporary accommodation.10
“To make things easier, there are plenty of online calculators, including Youi’s Home Insurance Calculator, which can help you estimate your sum insured for your buildings cover,” explains Hartley.
Type of cover
Your premium can also change based on whether you want building insurance, contents insurance or a combined home and contents policy, as well as any optional cover you might choose.3
“At Youi, for instance, we offer optional accidental damage cover. This is for those times when you might damage your ceiling completing some DIY or break your TV screen,”19 says Hartley.
“Although optional cover can increase your home insurance cost, depending on your circumstances it may be worthwhile. Damage caused by accidents can be significant and one you're not prepared for”.
Claims history
Insurers may also look at your past claims when calculating your premium as an indication of their future risk in covering your property.11 The type, frequency and size of a home insurance claim may be considered and could mean your premium might be higher in the future,” says Hartley.
Your excess
“Excess is another key factor insurers consider,” says Hartley.
“Nowadays, many providers will let you nominate your excess from a range of set amounts, and choosing a higher excess could reduce your premium.”
However, a higher excess means you pay more out of pocket if you do need to make a claim.1
Why are home insurance premiums going up in Australia?
The rising cost of home insurance is having a real impact on Aussie households.12 But what’s behind it all?
One major factor is climate change, which has increased and intensified extreme weather events.13
According to the CSIRO, a changing climate has seen Australia experience more severe bushfire seasons, an increase in extreme heat events and more intense heavy rainfall.14 As a result, one in 23 properties nationally are now at high risk from one or more climate hazards like fires and floods.13
“This in turn can impact a property’s risk profile and therefore the cost of any premium to insure that property,” says Hartley.
“Another major factor is rising building costs which have meant repairing or replacing a home has become generally more expensive.”
Australian Bureau of Statistics (ABS) data shows that home construction costs rose more than 40% from 2020 to 2024 and remain high.15
Tips that might save you money on your home insurance
“While the average cost of insuring a home may be trending upwards, there are some steps homeowners can take that could potentially help reduce their premiums,” says Hartley.
Here are some ways you might be able to lower your home insurance costs:
Reduce your risk
There are many good reasons to cover your home for fire, storm or flood damage, even if you live in an urban area. But disaster preparation may positively impact your premium.16
Increase your excess
“Choosing a higher excess on your policy might mean a lower premium but it’s important to be prepared to cover that higher out-of-pocket amount should a claim arise,” says Hartley.
According to CHOICE, home insurance premiums generally go down by about 10% for every $500 increase in excess.7
Compare your options
As we’ve established, premiums can vary quite a bit between insurers, so it can help to shop around.17
“Policy Renewal time is also a good opportunity to review and compare your cover to make sure you’re getting a good deal,” says Hartley.
Pay annually
“Some insurers, including Youi, offer a reduced premium when you choose to pay annually, rather than in monthly instalments,” explains Hartley.
“So, if this is an option for you, it could be a good way to save.”
How to get a home insurance quote with Youi
“Getting started with ahome insurance quote from Youi takes just minutes,” says Hartley.
Here’s how:
- Click start a quote on our website
- Follow the prompts and provide details about your home
- Submit, and we’ll be in touch with your quote soon.
Prefer to do it all over the phone? Just give us a call on 13 YOUI (13 9684) instead.
Home insurance costs: Some common questions answered
Now that we’ve covered the key drivers that help shape home insurance costs, let’s move on to some follow-up questions that we frequently hear.
Are apartments cheaper to insure than houses?
“Dwelling type is typically one of the factors insurers consider among others when calculating an insurance premium, so living in an apartment won’t automatically mean your insurance is cheaper than if you live in a house,” explains Hartley.
“However, many apartment dwellers may already have building insurance in place through their strata title, so they could save by opting for a contents-only policy to cover valuables inside their four walls.”
How much should home insurance cost for renters?
If you rent your home, you probably won’t need building insurance, as this is usually covered by your landlord.5
However, you might still want to take out cover for your contents. At Youi, we offer renter’s insurance, which is contents cover suitable for tenants who rent a property either temporarily or long term.18,19
“As with standard home insurance, the cost of contents insurance for renters can vary depending on your location, coverage amount, excess amount and claims history,” says Hartley.
How much does vacant home insurance cost?
Vacant home insurance might end up costing you more than standard home insurance if you need to make a claim, as you might have to pay an “unoccupied excess”.20 This is because vacant homes are deemed to be at a higher risk of theft, vandalism and undetected damage, such as water leaks.20
“Some insurers may not cover your home if it’s been unoccupied for a certain period of time, so it’s a good idea to check your cover before you leave, whether that’s for an extended trip or while you’re renovating or spending time at another residence,” explains Hartley.
“If you’re with Youi, you’ll need to tell us if the dwelling will be vacant. And, if it’s unoccupied for more than 60 days, an additional unoccupied excess may apply to an insurance claim.” 21
How much does flood insurance cost?
How much you’ll pay for flood insurance depends on your insurer. Some include cover for flood as standard, while others make it available for an extra fee.22
“At Youi, flood insurance comes as standard with our home insurance product,” says Hartley.23
“But it’s a good idea to check your policy documents carefully before you commit, so you know exactly what is – and isn’t – covered.”
What kind of home insurance do you need for a holiday home?
The type of home insurance you may need for your holiday home could depend on whether or not you lease the home, and how often it is left unoccupied” says Hartley.
“It’s a good idea to check with your insurer, especially if the holiday home may be left vacant for extended periods of time.”
If you rent out your holiday home, however, the Insurance Council of Australia advises that standard home insurance or cover provided by a rental platform may not be enough.24
“In that case, you could explore insurance for holiday homes instead, such as Youi’s holiday rental insurance.”
Do security cameras lower insurance costs?
Security cameras are a great way to boost your home security, but they may not necessarily lower your home insurance cost.
“At Youi, for instance, we consider certain types of security systems, such as local and back-to-base alarms, when calculating a premium,” says Hartley.
“If you want to boost your security as a means of lowering your insurance premium, it might be a good idea to talk to your insurer first.”
Is home insurance tax-deductible if you work from home?
The Australian Taxation Office (ATO) advises that employees who work from home generally can’t claim insurance as a tax deduction,25 but you may be able to if you run a business from home.26
However, it’s important to note that standard home insurance policies generally don’t cover business activities.27
“At Youi, for example, our home and contents insurance policies don’t cover business items such as equipment and tools as standard, but you may be able to add optional cover for these items.”19
“If you work from home in your own business, it’s a good idea to ask your insurer what you are and aren’t covered for.”
So, while there’s no “average” home insurance policy that fits everyone, understanding the factors that influence home insurance costs may help you find better value when exploring your options.
Looking to buy or renew your home insurance cover? Start a quote online or give us a call on 13 9684 to discover if Youi home insurance is the right fit for you.
1 Source: Moneysmart – Choosing home insurance, n.d.
2 Source: ABC News – Home owners struggle as insurance premiums rise more than 50 per cent in five years, February 2026
3 Source: Canstar – Home Insurance Cost: How much is home and contents insurance?, January 2026
4 Source: Canstar – What does building insurance cover, March 2024
5 Source: Moneysmart – Contents insurance, n.d.
6 Source: Canstar – What is home insurance and what does it cover?, April 2025
7 Source: CHOICE – How to save money on your home insurance, February 2026
8 Source: Insurance Council of Australia – Premiums explained, n.d.
9 Source: CHOICE – How to find the right home and contents insurance policy, December 2025
10 Source: Insurance Council of Australia – The risk of underinsurance, n.d.
11 Source: Financial Rights Legal Centre – Home or Contents Insurance Claims, December 2024
12 Source: Actuaries Institute – Home Insurance Affordability Update and Funding for Flood Costs, n.d.
13 Source: Climate Council – How is climate change affecting the property market?, November 2025
14 Source: CSIRO – State of the Climate, n.d.
15 Source: Australian Bureau of Statistics – Insights into Output of Building construction prices, August 2024
16 Source: Insurance Council of Australia – Reduce your risk, n.d.
17 Source: Canstar – How to save on home insurance, January 2024
18 Source: Canstar – What is renters insurance, April 2025
19 Limits and exclusions apply and there are waiting periods or additional fees for certain types of cover. Full details are in the PDS and TMD, which we recommend you consider before making any decisions regarding our products.
20 Source: Canstar – Unoccupied home insurance – can you get cover?, December 2024
21 Exclusions, limits and additional fees may apply. For full details, see the Home Insurance PDS.
22 Source: Canstar – Flood Insurance: Flood Cover for Home Insurance, April 2026
23 Exclusions and limits may apply. Where you have increased your cover or reduced your excess within 72 hours of a flood, storm, hail or bushfire occurring, cover will be limited to the amount that was effective prior to the change. Loss, damage or legal liability caused by, resulting or arising from flood, storm, hail or bushfire during the first 72 hours of your policy first being purchased is excluded unless certain conditions apply. For more details see PDS, TMD and your policy schedule.
24 Source: Insurance Council of Australia – Short-term rental insurance: essential for holiday homeowners, November 2023
25 Source: Australian Taxation Office – Working from home deduction, July 2025
26 Source: Australian Taxation Office – Deductions for home-based business expenses, July 2025
27 Source: Australian Government – Home-based businesses, n.d.
