Need to know
- Accidental damage is an insured event covered by some home and contents insurance policies, usually as an optional extra
- It covers mishaps that result in damage to your home or its contents
- There are lots of exclusions associated with this cover so make sure you read the fine print
What is accidental damage insurance?
You can take out accidental damage insurance as part of your home insurance policy. It provides cover for sudden and unforeseen damage to your property that wasn't caused on purpose.
It's designed for accidents and mishaps like red wine spills on the carpet, scorching a benchtop with a too-hot pot, or accidentally knocking a hole in the wall when moving furniture.
You might consider adding accidental damage to your insurance if you have accident-prone children or boisterous pets, furniture or electronics that are costly to repair or replace. But if you're after cover for specific items or events, make sure you read the PDS to confirm.
How does accidental damage cover work?
Accidental damage cover is not included as standard in basic home insurance policies. It's usually an optional extra that you can add to your policy for an additional fee.
Sometimes when insurers offer different tiers of policies, accidental damage may be included in the top tier policy, along with other inclusions that you may or may not need. If you need to claim, it works like any other insured event. You pay your nominated excess, and the insurer covers the rest – up to the sum insured or sub-limit that applies.
Use our home insurance comparison to find out which insurers cover accidental damage.
How much does it cost to add accidental damage cover?
The cost to add this extra cover to your home insurance policy depends on a number of factors. If you have combined home and contents insurance, it will typically add between 4% and 10% to the cost of your policy, but if you have only contents insurance, the mark-up is usually 15%-31%.
Your location will also play a role. In Queensland and the Northern Territory, where base premiums are usually higher than in the rest of the country, the mark-up is typically lower.
Which insurers have the cheapest accidental damage home insurance?
We found that the cheapest policies for accidental damage cover are usually the ones that offer it as an optional extra, rather than the top-shelf products that include it by default.
Cheapest home and contents policies for accidental damage:
- Australia Post
- AAMI Home and Contents
- NRMA Home Buildings and Contents Standard
- QBE
- Westpac*
- Allianz
* Identical policy available for the same price through BankSA, Bank of Melbourne and St.George.
Cheapest contents-only policies for accidental damage:
- Suncorp Classic
- TIO
- RACV
- GIO Classic
- Suncorp Classic Extras
- AAMI Home Contents
Suncorp Classic Extras includes accidental damage cover as standard, for all the other policies it's an optional extra.
What does accidental damage insurance actually cover?
As with any insurance purchase, it's important to read the PDS before you buy to understand what's included and what's not.
This is particularly important with accidental damage insurance because of the variation in cover both between policies, and within the policy – in terms of what's covered for accidental damage compared with what's covered for the other insured events.
The lists of common inclusions and exclusions below give an idea of what may or may not be covered for accident damage.
Common inclusions
On top of the comprehensive cover for accidents, some policies cover things in their accidental damage option that are explicitly excluded in other sections of the policy. For example:
- Fire: some policies cover damage caused by ash, heat, soot or smoke where there is no flame damage present. Similarly, some policies cover charring or melting caused by items that generate heat or smoke, like space heaters and cigarettes.
- Animal damage: some policies only cover animal "impact damage.
- Motor burnout (in a fridge or air conditioner, for example): while most policies offer this as a separate optional extra (or cover it by default), some bundle it with accidental damage cover.
- Power surge: while typically covered if caused by lightning strike, some accidental damage policies cover power surge regardless of the cause.
Note that these are just some examples – for every policy that has these inclusions, you will find one that excludes it. And because accidental damage is so broad, you're more likely to see a list of exclusions rather than inclusions, leaving you to read between the lines to figure out whether you are covered.
Common exclusions
Damage that occurs over time is excluded from accidental damage cover. The examples generally given are wear and tear, fading, or earth movement. Damage must usually be the result of a single, identifiable cause.
Other common exclusions from accidental damage cover include:
- Certain items while in use such as bicycles, fishing gear, musical instruments or firearms
- Certain items while being handled, such as china or glassware
- Damage to retaining walls
- Damage to pontoons, jetties and boat moorings
- Loss caused by computer malfunctions or viruses
- Anything in the policy's "General Exclusions" section. Sometimes the policy's accidental damage section will be quite short, because all the exclusions apply to the entire policy rather than this one event.
Jewellery, watches and mobile phones are also sometimes excluded. Small items may be better covered by portable contents cover.
What if I want cover away from home?
Some insurers include accidental damage cover for your items, like a laptop, musical instrument or sporting equipment, when you're away from home. But typically for cover outside the home, you're better off with separate portable contents cover. It has some overlap with accidental damage cover, in that your portable items are covered for accidental loss and damage at home as well as away. However, it does usually come with sublimits and a more restrictive list of items that can be covered. Few insurers cover the whole list of general contents away from home under their premium policies.
How is it different to accidental breakage?
Accidental breakage is an insured event that is covered by default in standard home insurance policies. It covers things made of glass (and sometimes other breakable materials like ceramic or fibreglass). Cover is usually limited to things like mirrors, baths and cooktops. Accidental damage cover, on the other hand, applies to a much wider range of items.
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Stock images: Getty, unless otherwise stated.
