After returning from a relaxing holiday, the last thing anyone expects is to find their home damaged or possessions lost. But even more surprising—and frustrating—is discovering that what seemed covered under an insurance policy actually isn’t.

It’s a scenario many people find themselves in: confidently lodging a claim, only to be told certain items aren’t covered, claim limits apply, or specific exclusions kick in. Despite paying premiums for years, the payout might fall far short of expectations.

The Illusion of Full Coverage

Many assume that a “comprehensive” home and contents insurance policy automatically includes everything of value. However, policies are full of fine print, exclusions, and sub-limits. High-value items like jewellery, rare collectibles, art, and even electronics are often only partially covered—unless specifically listed or declared when taking out the policy.

What often slips through the cracks are things like accidental damage, flooding, and items used for business at home, such as photography or IT equipment. For example, home office items might be subject to a small sub-limit, even if their total value exceeds several thousand dollars. And while water damage might be covered under some policies, flood damage usually requires optional, separate cover.

Understanding Loopholes and Exclusions

Insurance policies use precise wording that can result in unexpected denials. Some common reasons for rejected claims include:

• Item not specified: High-value belongings not listed separately may only be reimbursed up to a general sub-limit.
• Location not covered: Items stolen or damaged outside the home may not be included unless portable valuables cover is added.
• Type of damage excluded: Wear and tear, mould, vermin, and gradual deterioration are typically not insurable.

What seems like a loophole is usually a policyholder misunderstanding—caused by the complex and jargon-heavy nature of insurance documents.

Why a Good Insurance Broker or Adviser Matters

One of the most important steps in securing the right protection is working with a qualified, reliable insurance broker or adviser. Their role goes beyond setting up a policy—they help navigate options, explain exclusions, and ensure all high-risk or high-value items are appropriately declared.

An adviser can:

• Recommend suitable cover based on lifestyle and possessions.
• Alert you to limitations or exclusions in your current policy.
• Help with accurate valuations and itemised listings.
• Support you through the claims process, acting as your advocate.

Regular reviews with a broker or adviser—especially after big purchases, renovations, or changes in living arrangements—can prevent underinsurance and ensure your policy evolves with your life.

Tips for Ensuring Valuables Are Fully Covered

1. Document everything: Keep records of purchases, including receipts, photographs, and serial numbers.
2. Get valuations: Have jewellery, antiques, or collectibles professionally appraised.
3. List high-value items separately: Most insurers require specific items to be listed individually.
4. Review sub-limits: Understand what caps apply for categories like electronics, bikes, or tools.
5. Add optional covers: Portable contents, flood protection, and accidental damage may not be included by default.
6. Store documentation safely: Use cloud storage or digital tools for access when needed.
7. Update regularly: Review your policy every 12 months or after major changes.

Top 10 Items Often Not Covered (or Underinsured)

1. Jewellery and watches worth over $1,000 each – Require itemisation and sometimes valuation.
2. Portable electronics outside the home – Phones, laptops, and tablets need additional portable cover.
3. Flood damage – Generally not included in basic home insurance.
4. Home office or business equipment – Limited cover unless disclosed.
5. Collectibles and memorabilia – May not be classed as general contents.
6. Wear and tear – Age-related damage is almost always excluded.
7. Mould and pest damage – Not covered under standard policies.
8. Unregistered vehicles – Like drones, e-scooters, or trail bikes.
9. Items in storage units or temporary locations – Need separate or extended coverage.
10. Damage caused by pets – Scratching, biting, or chewing usually not claimable.

Insurance is not just a matter of ticking boxes—it’s about understanding what’s actually protected and being proactive in managing your risks. Relying on assumptions or skipping the fine print can cost thousands when the unexpected happens.

Reviewing policies annually, working closely with a trusted adviser, and taking time to understand the fine print can mean the difference between a smooth recovery and an expensive lesson.

If this article has inspired you to think about your unique situation and, more importantly, what you and your family are going through right now, please get in touch with your advice professional.

This information does not consider any person’s objectives, financial situation, or needs. Before making a decision, you should consider whether it is appropriate in light of your particular objectives, financial situation, or needs.

(Feedsy Exclusive)