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Personal Property Protection –
Homeowner’s Insurance Coverage and Benefits

Homeowner’s insurance will typically cover an individual’s personal property in the event of loss, damage or theft.

Personal property relates to all personal items within the dwelling such as, clothes, furniture, carpets, watches, appliances and jewellery. The personal property definition does not extend to the dwelling itself. Very valuable items, such as jewellery, watches and antiques, will have to be specified and may have a restricted or deflated pay-out value.

Trees and plants are typically covered as ‘personal property’.

Personal property — away from the home

Personal property taken out of the home is subject to insurance coverage under a protection policy. Much of personal property is now essentially portable, like phones, cameras and laptops. These items are most at risk of loss, theft or damage once taken into the public domain.

This includes personal items in storage.

Homeowner insurance will maintain coverage of these items even away from the house. This is usual but not categorically guaranteed. Items may have to be specified in the policy and there may be some provision of care added.

Cars, sheds, garages and outhouses

The family car, albeit a personal possession, will not be covered by homeowner’s insurance. Separate car insurance will be required.

As for other buildings detached from the dwelling, these may need a separate policy or a caveat added to the existing one.

How are values determined following a claim?

Claimants will have damaged property replaced on a ‘new for old’ basis. The insured party will receive the cost of replacing an old item with a new one; a new one of similar spec at current values.

Premiums are calculated on the cost the insured has estimated for item replacement. Premiums reflect the insurer’s risk for this calculated amount.


Underinsuring occurs when the insured has undervalued the items subject to cover. For example, an item costing $2,000 to replace has been incorrectly valued at $500. The item has been undervalued and therefore underinsured.

Under such circumstances the insured will received a reduced pay-out in accordance with the original assertions as to value. Underinsuring may incur voidance of a policy.

Liability protection

Liability protection in a homeowner’s policy is common place. Liability protection extends to all residential family, and covers the event of damage caused to a third party’s well being or property. For example, accidentally kicking a football through a neighbor’s window.

Furthermore your policy will provide medical cover for visitors injured in your house.

Homeowner’s insurance rented accommodation

If you are in a rented accommodation you also qualify for personal protection insurance. The landlord will have insurance, but this will only be in place to protect the building structure and guard against possible civil litigation in respect of the property or its impact on others.

People in a rented accommodation can take out a homeowner’s insurance to protect their personal belongings against theft, loss or damage.

In conclusion

Personal property protection insurance, within a homeowner’s insurance policy, provides safeguards against the unforeseeable, like protecting the insured party from the possibility of substantial financial loss in the event of damage, loss or theft of personal property.