Singapore has the second-most expensive housing market in the world; it costs several hundred thousand dollars to own a HDB flat while condominiums and landed properties are usually over a million dollars.

Given the hefty price tag of properties and the many valuables inside, surely you'll expect most people to have a home insurance policy? Well, that's only if they see the value of a home insurance policy.

There are a few reasons why Singaporeans may not buy home insurance. Firstly, Singapore is relatively safe from natural disasters and crime rates are low. For those who stay in condominiums, there will also be security guards, which makes their homes seem even safer.

Some people also see insurance premiums as a cost rather than a benefit, so they may not see a need for insurance. However, it'll be overly complacent to assume that your home is immune from any accident.

Is it worth it to pay for home insurance?

While fire insurance is compulsory for HDB homeowners, more people might be unaware of home insurance and its benefits. Fire insurance only covers for a specific event and for structural damages caused by fire only. If you want to get insurance cover for other incidents and the interior of your home, you'll need a home insurance policy.

What is home insurance?

Home insurance offers more comprehensive coverage. With home insurance, you'll be covered on losses and damages to your interior renovation, furniture, valuables, personal belongings, and even your pets. You can also be insured for other unexpected home incidents with an all-risk home policy.

There are two kinds of home insurance policies. Insured peril home policies cover for specific incidents like fire or flooding while an all-risk home policy that comes at a higher premium covers for all unexpected incidents at home. Home insurance generally covers for building, renovation, and content.

Building – This refers to the structural aspects of your home like your pillars, walls, floors, and garden. Should they be damaged by a covered incident, you'll be compensated on what it costs to reinstate them.

Renovation – Your interior renovation like built-in carpentry and fixed fittings falls under this area.

Content – For movable items like your appliances, electronics, valuables, and personal belongings, they fall under Contents within the home, and there is usually a limit to how much you can claim for each item.

Apart from these main coverages, you should also look out for the 'Personal Liability' cover and other smaller add-on covers, which may or may not be relevant for you. Usually, the price difference amongst insurance plans is due to these extras, so you really should understand what they are and pay only for the coverage that you'll need.

Home Content Cover


Weighing the value of your home VS the cost of insurance premiums

When considering home insurance, it helps to think about the value of your home.

For example, renovations for a 1,000 square feet apartment could easily be in tens of thousands of dollars and over $100,000 for landed properties. Add in the latest high-end appliances, state-of-the-art furniture, valuables, and your personal belongings, that sum can be a lot! Considering that a basic home insurance plan costs around $50 a year for a 3-room flat and over $200 a year for landed properties, the annual premiums actually cost less than 0.01% of the value of your home.

  3-Room Flat 3-Room Condominium Landed Property
Annual Premium $55.73 $62.76 $225.18
Building cover $50,000 Separate* $200,000
Renovation cover $40,000 $40,000 $60,000
Content cover $20,000 $20,000 $40,000
Alternative accommodation $300 daily, up to $15,000 $300 daily, up to $15,000 $300 daily, up to $15,000
Home assistance Up to $100/incident, max 4 times a year Up to $100/incident, max 4 times a year Up to $100/incident, max 4 times a year
Theft or damage to contents temporarily removed Up to $500/item, max $5,000 Up to $500/item, max $5,000 Up to $500/item, max $5,000
Personal liability Up to $500,000 Up to $500,000 Up to $500,000

*For condominiums, their Management Corporation will have insurance that covers for the common areas, as well as the building, and original fixtures from developers. Hence, building cover is excluded from these plans.

When choosing a home insurance plan, make sure to get the right amount of cover. If you are found to have under-insured your home, the payout that you get will be proportionate to how much you have paid.

For example, if the value of your renovation is $80,000 and you get a policy that only covers up to $40,000 in Renovations, this means that you're 50% under-insured. Say for example your stove has a mini-explosion that destroys the kitchen countertop and cabinets and it costs $30,000 to reinstate your kitchen renovations, you'll only be compensated $15,000 (or 50%) because you are under-insured on Renovation cover.

There are also limitations to how much payout you can get. On most plans, you'll only get up to $500 cover per item, up to a certain limit or a percentage of your total Contents cover. Nonetheless, the home insurance policy is a small sum to pay to insure against the potential losses and costs of reinstating your home.

What do you get with a $50 annual home insurance premium?

On top of the building, renovation, and content cover, here are some other types of coverages that may be included in your home policy or may come as an add-on. Depending on what you have at home, you can get the relevant cover or you may choose to go with a basic no-frills plan. 

Personal liability – If you or your household member are legally liable for accidental harm caused to third-parties, this cover will pay for the legal damages.

Home assistance – Whether it is to repair a burnt fuse, fix a burst pipe, or to engage a locksmith to unlock your door, the home assistance cover can help to defray the costs of these small incidents.

Home appliances (add-on) – Some insurance plans offer home appliances coverage where they cover for repairs of faulty appliances. There are limits to the amount you can claim and the number of times you can claim each year.

Pet cover (add-on) – Pet cover only applies to cats and dogs. You'll be compensated if your pet is stolen, dies, sustain an injury that requires medical attention, or if you've to put them up in a pet hotel because your home is deemed uninhabitable because of the incident.

Family personal accident (add-on) – This is essentially a personal accident plan that covers your family for injuries, disabilities, and medical bills sustained because of unexpected home incidents. 

Home insurance plans will differ in the amount of coverage, in the types of coverages, and also for insured-peril or all-risks. So be sure to know what you're paying for and how you're covered, and get the right coverage amount.

Singapore may be safer than a lot of other countries, and that's why home insurance premiums also cost lesser – they are proportionate to the risks involved. Rather than avoid insurance because of its cost, think about what you're protecting yourself from.

Still not convinced? Check out the full coverage and premium amounts across home insurance plans on our website.


Compare Home Insurance on GoBear


Related articles:

Home insurance protects your home from more than just fires

An essential checklist for home insurance

Home insurance - what you need to know



Zhi Han

Zhi Han

He specialises in writing on investing and finance topics and is a long-time supporter of cryptocurrencies.