WHAT IS LANDLORD INSURANCE AND DO I NEED IT?

For most investors, their property is their biggest asset.


So it can be an overwhelming thought to let complete strangers into your home and expect them to look after it. Whilst most tenants are decent humans, sometimes you hear the occasional “Tenants gone bad story” on the news, such as this story about a tenant from hell who destroyed a man’s home in Perth.

That’s why it pays to have landlord insurance. Whether the damage caused by a tenant is deliberate or accidental, landlord insurance gives you peace of mind knowing you and your asset are protected from damage and loss of rent. Consider the following points to help you choose a landlord insurance cover that’s right for you.


Research and compare

There are loads of providers to choose from when it comes to landlord insurance, be sure to shop around and do your research. Always compare prices and cover inclusions. Consider using an insurance company that specialises in landlord insurance, as they usually provide a more comprehensive cover.

A massive hole in a wall

Ensure you compare apples to apples when comparing insurance companies.


Are pets covered in your policy?

Allowing pets to live in your property does not come without extra risks. If you have approved a tenant for rent who has a fluffy friend, check your policy covers for damage caused by pets. Some policies do not cover pets at all, while others may charge a higher premium for approved pets.

Wine spilled on the carpet

Your policy might not cover replacement carpet should Fido accidentally knock over a glass of wine.


Public liability insurance and body corporate

If you own a property within a body corporate (e.g. townhouse or apartment), building insurance is usually included in your fees. However, ensure you read the product disclosure statement thoroughly as you may find the public liability insurance only covers common areas and not within the property itself. Not only does landlord insurance cover damages to inside your building (e.g. damage to carpets, appliances, walls etc.), most policies will also protect you should a tenant suffer a medical incident or damage to the tenant’s property.

Fire in the kitchen

Body corporate insurance may not cover for damages inside your property, such as a replacement oven if the tenant accidentally sets it alight.


Over-insuring, under-insuring and excess

In most cases, the higher the value of the property, the higher the premium and the excess will be to insure your property with landlord insurance. But it’s important to not undervalue your property either. If you think about the cost it would be to replace all the fixtures and fittings in your home, it can add up. The excess amount is the amount you pay should you ever make a claim. Most insurance companies will allow you to take this out of your bond, check with your provider.


Loss of rent

If damage occurs to your property, it could take some time for this damage to be rectified. Or if the tenant loses their job, they may no longer have the income to pay their rent. Both instances may result in a long term loss of rent, longer than what your bond can cover. Leading landlord insurer Terri Scheer found that 30% of their insurance claims were rent-loss related. Check the rent loss cover within your policy.

House with severe damage

Severe damage or a change in the tenants’ circumstances could cause you to be without a rental income for a significant amount of time.


Fortunately, bad tenants are few and far between, and with a rigorous tenant selection process and quality property management, this should never happen to you. However, sometimes life happens, so be prepared by taking out landlord insurance to protect you and your property.

For a professional property management service call Jean Brown Properties. Our team would be happy to help you with your landlord insurance enquiry or answer any other property management questions you might have. Call us on 07 5630 1145

DISCLAIMER: Whilst every care is taken in the preparation of the information contained within the above writing, Write My Ad will not be held liable for any errors in typing, errors, content or information. All interested parties should rely upon their own enquiries in order to determine whether this information is in fact accurate.

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