How home insurance costs are surging across Melbourne suburbs — see the list

Homeowners across Melbourne are being hit with surging insurance premiums, as rising crime, inflation, and rebuild costs reshape the real cost of living — even in the city’s safest suburbs. Picture: NewsWire / Valeriu Campan

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Homebuyers in Melbourne’s traditionally safer suburbs are being stung as surging crime and soaring cost of building drives sharp hikes in home insurance premiums.

Exclusive analysis from Finder shows the average premium in Victoria has jumped $425 in a year to $2442 – the biggest annual rise recorded in the nation.

The most expensive municipality is now Bayside at $2812, where the spike is linked to rising crime, such as home break-ins and aggravated burglaries.

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High-profile residents such as Rebecca Judd have voiced safety concerns in affluent suburbs such as Brighton, where residents are planning to self-fund a $300,000 a year security presence to clamp down on out-of-control crime, while St Kilda has seen a spate of break-ins, including a terrifying home invasion at the home of actor Asher Keddie and artist Vincent Fantauzzo.

Finder insurance expert Peta Taylor said insurers were now factoring crime rates and rebuild costs into risk profiles, rather than focusing solely on bushfire and flood overlays.

Finder insurance expert Peta Taylor said premiums in Melbourne are rising fastest in areas once seen as low risk — driven by crime trends and rebuild costs.

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St Kilda is among Melbourne’s most expensive areas for home insurance, amid rising rebuild costs and a wave of break-ins — detailed in recent Herald Sun reports — push premiums higher. Picture: Josie Hayden

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“It’s not just about what your house is worth anymore, it’s about how much it would cost to replace it, where it is, and what the risks are,” Ms Taylor said.

“If a postcode keeps coming up with break-ins or theft claims, premiums go up.”

Ms Taylor warned many of the highest premiums weren’t necessarily in the wealthiest areas.

Bayside now tops Melbourne for average home insurance premiums, with rising crime and rebuild costs driving the surge, as revealed by Finder data.

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In Brighton, where residents like Bec Judd have backed private patrols to curb crime, rising insurance premiums reflect growing concerns about safety and rebuild costs. Picture: Jason Edwards

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“It’s more about exposure – to crime, storms, rebuild delays, even older housing stock,” she said.

“The risk of underinsurance is huge.

“In a worst-case scenario, some people could lose everything.”

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Homes in bushfire-prone areas can see higher premiums. Picture: Jason Edwards

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Some of the steepest average premiums in Melbourne are now in Maroondah ($2557), Port Phillip ($2483), Melbourne ($2506) and the Yarra Ranges ($2403).

By contrast, Whitehorse ($1578), Brimbank ($1602) and Hume ($1472) sit well below the metro average.

Melton, the municipality where home values are cheapest, has one of the highest average insurance premiums at $3247.

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Finder’s research shows around three per cent of policyholders – or about 370,000 households – have either downgraded their cover or let it lapse.

Nationally, the average premium has climbed to $2790, with many households now paying more than $3000.

Prominent Melbourne buyer’s advocate Cate Bakos said insurance had become a “sleeper issue” in Melbourne’s affordability crisis.

Buyer’s advocate Cate Bakos says skyrocketing insurance costs are now turning buyers away from otherwise affordable Melbourne properties.

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“It used to be something you budgeted for after the fact. Now it’s make or break,” Ms Bakos said.

“I’ve passed on properties when the insurance quote came back too high.”

Ms Bakos said the ongoing cost of owning a home was deterring buyers more than the upfront price in some cases.

Belle Property/Hocking Stuart Victorian director Anthony Webb said insurance rarely came up during negotiations but was increasingly catching buyers off guard after settlement.

“Buyers talk about stamp duty, rates, even renovations. But insurance? Not often,” Mr Webb said.

Mr Webb said he was surprised to see Maroondah up so high on the list.

The Insurance Council of Australia warns home insurance is becoming unaffordable for many, as crime, inflation and extreme weather drive up premiums.

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“Whitehorse and Maroondah, for example, they’re right next door,” he said

“But one can be nearly $1000 more.”

“More clients are asking us about flood overlays, fire risk, and even the age of buildings. It’s definitely a shift from a year or two ago.”

An Insurance Council of Australia spokesperson said home insurance affordability was a growing concern as extreme weather, inflation, and crime put pressure on premiums nationwide.

“Australia’s most densely populated areas are also exposed to our most expensive weather events,” the spokesperson said.

“One immediate way to bring down premium costs is to remove unfair taxes.

“In 2023–24, states earned $8.6bn from insurance stamp duty — nearly 60 per cent more than insurers made in profit.”

Average home insurance premiums by Melbourne municipality

Note: The insurance premium figures are sourced from Finder’s analysis of three major providers across selected Melbourne LGAs, while the median house prices for houses only are drawn from the PropTrack Market Trends LGAs March 2025 dataset.

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