Landlord insurance is an important means of protecting your investment property. Landlords’ insurance is an insurance policy that covers a property owner from financial losses connected with rental properties.
The most common landlord claims are tenant related issues over non-tenant related. According to EBM RentCover the majority of insurance claims were caused through tenant-related issues. The highest volume of claims processed in 2019 was loss of rent.
Common issues caused by tenants:
Loss of rent can arise if the tenant refuses to pay rent. However, it can also be caused through damages to the property. In the event the property is inhabitable the tenant may have to vacate for a period of time causing the landlord to receiving loss of rent.
Accidental damage by tenants is a common landlord insurance claim. Damages caused by the tenant are often discovered through routine property inspections or a final inspection when the tenant vacates permanently. These could be broken window furnishings, damaged flooring, multiple small holes and divots in walls throughout (e.g. caused by door handles or windows), knife marks on the kitchen benchtop, hair dye stains on the en-suite vanity, torn fly-screens etc. If the property is furnished, tenants can damage your furniture.
Common issues caused by non-tenants:
Though more claims are caused by tenant related problems, there are still many non-tenant related insurance claims. These are often from liquid damage (such as burst piping) overflowing bathtubs, leaking roofs and sewerage issues. Water damage is also a reoccurring claim often caused by storm and flooding scenarios.
Other notable claims can be caused by motor fusing related issues including air-conditioners, fridges/freezers, ovens, kitchen stoves, dishwashers, washing machines and dryers. These are incidents that may not be covered under standard landlord cover. Therefore we recommend consulting an insurance specialist before acquiring a policy.
The importance of landlord insurance cover
The importance of landlord insurance cover extends further to just damages. We have another article summarising other factors to consider when taking note of landlord cover. Click here.
At Crest Property Investments we help source brand new and off-the-plan properties for buyers of all types. When it comes to investors, we help plan your investment portfolio in advance with a careful contingency plan. Landlord cover is a critical component to secure your investment property. If you need any assistance, please don’t hesitate to contact us.
If you’d like to explore further the basis why property investment is widely the most popular asset in Australia click here.
While we have taken care to ensure the information above is true and correct at the time of publication, changes in circumstances and legislation after the displayed date may impact the accuracy of this article. If you want to learn more, please contact us. We welcome the opportunity to assist you.
Jan 2020
