More than a quarter of Australians may not have home or contents insurance, leaving them at risk of a huge bill from the wild weather tearing across the country.

A survey by Compare the Market found 26.5 per cent of surveyed Australians do not pay or home and/or contents insurance in the midst of the current cost-of-living crisis.

Home insurance typically covers protections for the building itself, whereas contents insurance covers the items inside the house, such as furniture, clothes and electronics.

Compare the Market’s Executive General Manager for General Insurance, Adrian Taylor, said insurance premiums were very likely to increase in 2024, making it even more expensive to cover your home.

“We’re not even far into 2024 and hundreds of thousands of Australians have already been impacted by torrential storms, damaging hail, flooding and cyclones,” he said.

“We’re continuing to experience these wild weather events, while the building industry has seen the cost skyrocket for materials and labour to repair or build homes. Similarly, inflation means the goods in our home will also cost more to replace. Unfortunately for everyday Aussies, this does come at the cost of higher premiums.”

Today, the average cost of home and contents insurance in an Australian household is $1741.30 annually. This is a very variable number, and can increase if your home is in an area at risk of flooding or crime. This number may also increase with rising premiums.

New South Wales residents are the most likely not to have home and/or contents insurance at 33.1 per cent, with Sydney being the most expensive city in the country.

South Australians are on the other end of the spectrum, with only 14.7 per cent not having coverage. Victoria is at 24.3 per cent, and Queensland is at 24.9 per cent.

Generationally, Baby Boomers and Millennials are far more likely to have insurance than Gen Z homeowners. Less than half of Gen Z’ers have home/contents coverage at 41.5 per cent, while Baby Boomers have 85.1 per cent coverage and Millennials are at 71.5 per cent.

“Younger generations may have only just moved out of home and may not be aware of the risks that could leave them significantly out of pocket,” Mr Taylor said. “If you are moving out of home or to a new area, it’s vital that you do your research.”

The housing market is also significantly more limited for Gen Z buyers. The Australian Bureau of Statistics reported in 2022 that the likelihood of owning a home between the ages of 25 and 39 has decreased with each successive generation.

Millenials were three times less likely to own their home without a mortgage than Baby Boomers were at that same age.

In 2023, the average home price is $920,100 – and the average income is $90,896. This means that the average Australian would need to pay up to ten times their annual income to buy a home without a mortgage.

Read related topics:Weather

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By Rahul

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