Fresh research into the home insurance sold by Coles, Woolworths and Aldi has questioned whether they’re offering consumers value for money and exposed some strange fine print.

On Monday consumer group Choice published an analysis of the insurance being offered by Australia’s three largest supermarkets, saying their policies are actually “fairly standard”.

But there are some things that set them apart, particularly at Coles and Woolworths, with Choice’s insurance expert Jodi Bird explaining that the supermarkets are collecting your data.

“Signing up for a home insurance policy with Coles or Woolies, and linking it with either Everyday Rewards or Flybuys, can give you bonus points and discounts on your groceries,” Bird said.

‘Handing over more information’

“Of course, the problem with this is that you’re handing even more information over to the supermarkets.

“There are many other policies out there that will provide you with the same or better cover, without needing to hand over your personal data to the supermarkets.”

Financial services like insurance have become big business for Australian supermarkets over the past decade.

They command a fee from larger insurers, who underwrite their products.

As TND has explained previously, this is a way for retailers to monetise their relationship with customers and the strength of their brand, in addition to collecting extra data on shoppers.

German giant Aldi moved into the insurance game earlier this year with a unique offer that includes premium reductions for consumers that allow ‘smart sensors’ to be installed in a home.

Supermarket insurance ranked

Overall, Choice rated the insurance policies offered by the supermarkets between 45 and 60 per cent, with Coles emerging on top (60 per cent) and Woolworths last (45 per cent).

Aldi scored just behind Coles at 56 and 57 per cent for its two insurance products.

But the consumer group warned that despite these ratings it’s unclear whether Aldi or Coles is offering value for money, because there’s a lack of price data in their product advertisements.

Additionally, in the fine print there are some strange details that aren’t typical across the market.

“The Coles policy has good coverage for emergency storage of undamaged contents if you can’t live in your home due to damage from an insured event,” Bird said.

“However, it doesn’t include any coverage for gardens or landscaping, which is an unusual exclusion.”

Storm surge coverage

Aldi, meanwhile, offers storm surge coverage that could be useful for coastal homes, but does not include vet bills in its household cover.

“In fact, vet bills are not covered by any of the supermarket home insurance policies, despite being covered by many other policies in our comparison,” Bird said.

Woolworths has two tiers of home insurance policies that are priced at different levels.

But Choice’s analysis found neither provided good value for money.

“We found many policies in our review that outperformed both of the Woolworths policies in terms of cost and coverage,” Bird said.

Bills soaring

Home insurance bills have soared over the past year as higher reinsurance costs filter through to consumers, making it more important than ever to avoid paying too much for cover.

The best way to do that is to compare policies across the market and be willing to negotiate with a provider to get the best deal.

TND has previously explored some ways to lower premiums for both house and car insurance.

“Get quotes from a few brands and see which one provides the best value for money,” Bird said.