Mozo Money Moves: Aussies bail on home insurance as premiums rise by up to 30-40% in just 12 months

Home Insurance Moves

This week, new Mozo research found Australians who have seen home insurance premiums rise are now paying $316 more on average for home insurance than they were last year. 

The rising costs have seen almost 2 in 5 Australians living in areas affected by natural disasters bail on home insurance altogether. Those in bushfire affected areas were the most likely to report their premiums had increased (42%), followed by those in flood-affected areas (32%).  

“The amount of Australians that have resorted to cancelling their home insurance because they can’t afford it is shocking,” Mozo money expert Rachel Wastell said, “but what’s more concerning is many are likely paying these rising premiums without realising they’re underinsured.”

“If you’re living in a natural disaster-affected area, and you’re paying for home insurance, you should double-check that you’re fully covered.”

“We are in an El Nīno season, which means the likelihood of bushfires over summer is high, so you want to be sure your home insurance covers both the rebuild of your home and any structures or equipment you have on the property.”

Mozo Insights:

• Customers choosing not to cancel home insurance policies need to do their due diligence, to make sure they’re not underinsured. 
• The cost of construction has skyrocketed over the past five years, so now could be a good time to compare home insurance policies.
• The Mozo Experts Choice Awards 2023 provide a handy shortlist to review the best of the best when it comes to insuring your home.

Home Loan Moves

With three of the four major banks holding the belief that the RBA cash rate has peaked, we’re seeing a number of cuts in the fixed rate home loan space.

However, there have also been some increases, with rate changes varying depending on the loan term and the type of borrower. AMP, ANZ, Greater Bank, and NAB have all recently cut fixed rates by up to 40 basis points, while HSBC, Hume Bank and Auswide Bank have increased some fixed rates by up to 70 basis points. 

Westpac was mixed in its approach, with a number of different cuts and increases across the board.

Despite the cuts, the lowest fixed rates from the Big Four still all start with 6, while more competitive loans from smaller lenders are boasting fixed rates starting with 5. 

Lowest Fixed Rate Home Loans

Mozo Insights:

• Struggling to save for a home loan deposit in Australia’s capital cities? It may help to look at the three cheapest suburbs. 
• Confused about how a home loan works? Money writer Evlin Dubose answers all your home loan questions.
• If your current home loan interest rate starts with 6 or 7, now could be the time to shop around. Here are some rates starting with 5.

Savings Accounts Moves

A strange coincidence has emerged in money markets, and we’re now seeing both home loan interest rates and savings account interest rates starting with 5.

If you have managed to build up a savings buffer during the pandemic, and you’re earning interest at a rate starting with 3 or 4, make sure you’re not paying the ‘loyalty tax’ and keep an eye out for higher rates.

High Interest Savings Accounts

Mozo Insights:

• As retail spending declines, money writer Sophie Wong dives into whether its a good idea to try and double down on your savings.
• After another pause to the RBA cash rate last week, which banks are still hiking interest rates on savings accounts?
• Are you a parent thinking about teaching your children the value of growing their money? These kids' savings accounts could help.

As a part of Mozo’s commitment to making your money count for more, each month we “roundup” the rate changes, key banking trends and money moves in the Australian personal finance market. 

We’ve included a snapshot of some of the top rates on offer in the market at the moment below, but if you’d like to see the roundup in full including the expert analysis, you can subscribe here.

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