How much you should insure your house for in Australia is full replacement cost to rebuild house as new, including demolition, site clearing, architect fees and materials, not market value, with average rebuild cost $500K to $700K for standard 3-bedroom brick veneer house, $700K to $1M for 4-bedroom, based on 2024-2025 building costs. To estimate, use $2,000 to $3,500 per square metre for standard build, so 150sqm house costs $300K to $525K plus demolition $20K, architect $10K, and cost escalation 10%, total $350K to $600K. Insurer calculators from NRMA, Allianz, Budget Direct ask postcode, house size, bedrooms, construction type brick or weatherboard, and give estimate $500K to $700K for 3-bed. Many Australians underinsure building by 30%, insuring $350K when rebuild costs $500K, leading to underinsurance where insurer only pays proportion. For example, if you insure $350K but rebuild costs $500K, and you claim $100K for fire damage, insurer may only pay $70K due to 70% insured. So you should insure for full replacement cost, not market value which includes land, and add 10% buffer for inflation and code changes. For 3-bed house, insure $500K to $700K building plus $80K to $120K contents, for 4-bed $700K to $1M building plus $100K to $180K contents. Get professional valuation or use Cordell calculator for accurate rebuild cost.
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