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Buying, selling and insurance

Termite damage is the classic uninsured loss. The protection is the inspection you pay for before you sign, not the policy afterwards.

Two comparison cards. Home building insurance is built to respond to sudden, accidental events such as a storm or a burst pipe, at an identifiable moment. Termite damage is gradual and, in the insurer's own reasoning, preventable through maintenance and inspection, so general exclusions for termites, vermin and insects are standard across the market and written into the disclosure statement, not hidden in small print. A card underneath explains that the real protection is a timber pest report done before the contract goes unconditional, which is a conveyancing question, not an insurance one. — The protection is the inspection you pay for before you sign, not the policy afterwards.

Most policies exclude it, and that is not a loophole

Home building insurance in Australia generally excludes damage caused by termites, vermin and insects. This is standard across the market and it is not hidden. It is in the product disclosure statement, in the general exclusions. The reasoning insurers give is that termite damage is gradual and preventable through maintenance and inspection. And gradual damage is not the kind of sudden, accidental event home policies are built to cover.

That makes the pre-purchase building and pest inspection the real protection. And it is one of the few places in this subject where spending decisions are clear-cut. A timber pest report done before the contract goes unconditional tells you what is there, what could not be seen, and what conducive conditions the property has. Depending on the state and the contract, the report may support a right to withdraw or renegotiate: but that is contract law and it varies. So it is a conveyancer's question, not ours.

What we will not do is interpret your policy or your contract. Policies differ, states differ. And the difference between an exclusion and an exception is exactly where the money is. What we can do is tell you what the standard position is, what the report is supposed to contain. And what questions to put to your insurer, your conveyancer, or your state's consumer affairs or fair trading body.

If a house you are looking at has a termite management system, ask for its documentation and its inspection history. A barrier with no records is, for practical purposes, a barrier of unknown condition.

Buying guides

Insurance Does home insurance cover termite damage?

Why the exclusion is standard, what insurers mean by gradual damage, and the narrow situations where a resulting event may be treated differently.

Buying The building and pest inspection before you buy

What a timber pest report contains, why the list of inaccessible areas matters most, and what to ask before the contract goes unconditional.

Buying and insurance The termite management plan and the durable notice

What the plan records, where the durable notice is fixed in an Australian house, and why it is evidence of installation rather than of protection.

Buying and insurance Termite warranties: what they actually cover

The four different promises sold under the word, the condition that quietly voids nearly all of them, and who to ask when yours is tested.

Buying Pre-purchase inspection on a house: what it covers and what it leaves out

What is in scope on the day, what the report excludes, and why access decides how much of the house it really covered.

Buying How long does a building and pest inspection take?

What a normal visit looks like, what stretches it, and what a very short one can mean.

Buying AS 4349.1: what the pre-purchase building inspection standard covers

The building half of a building and pest report, why termites sit in a different part of the standard, and what to ask for.

Buying Pre-purchase inspection checklist for termites: what to do before and after

What to arrange before the visit, what to ask on the day, and how to read the limitations before the findings.

Buying Buying a house with termites: what to check first

What the finding means, the questions to put to the inspector, and why you leave the evidence alone.

Buying Who pays for a termite inspection?

Buyer, seller, owner or landlord: who normally pays, and what to confirm in writing before you book.

Buying Building inspection in Australia: where termites fit

What a building inspection covers, what it leaves out, and why you need a separate timber pest report.

Buying Building inspection checklist: timber pest items

The termite and timber pest questions a general building checklist misses, before and after the visit.

Sources

What this page explains is based on these official sources. If you check one and it does not match what you read here, send it to us and the article gets corrected.

Standards Australia. Australian Standards (AS 3660 termite management, AS 4349.3 timber pest inspection)
Queensland Building and Construction Commission. Protect against termites — termite management systems and inspections