"Am I insured if DIY electrical work causes a problem"

This is an interesting question I found in the list of keywords used in Google searches that led to this site. Let me give the short answer to the question. No :)

Here is what NECA (National Electrical and Communications Association) says:

... home owners with illegal wiring may find that they are not covered by the Home Building insurance policy in the event of a fire which can be traced to the illegal wiring as the cause of the fire

And a standard policy document from AAMI says:

You must at all times, and at your expense, take all reasonable precautions:
......
to ensure compliance with all statutory obligations, by-laws or regulations imposed by any public authority, relating to the safety of persons or property.

If you do not, we may reduce or refuse to pay any claim you may make.

As per the Electricity Safety Act 1998 it is illegal for an unlicensed person to undertake electrical installation work in Victoria.Persons who do undertake such work can be prosecuted in the courts and subject to substantial financial penalties.

Registered electrical contractor card

Electrician's license card

Stay safe. Always use a registered electrical contractor and a licensed and qualified electrician to do the work to the required standards. Ask to see their license – it is your guarantee that you are working with someone who knows that they are doing and gives you avenues for recourse if something goes wrong. Also make sure that you get a certificate of electrical safety once the work is complete.