Why Landlords Insurance is a Must

Why Landlords Insurance is a Must

As a landlord, there are several boxes you need to tick to ensure you are meeting your obligations including understanding your state or territory laws, tenancy applications, smoke alarms and pool safety and home insurance to name a few. Sitting right at the top of this list is ensuring you are adequately covered with sufficient landlords insurance.

Landlords Insurance is an absolute must for property investors. Like other insurances such as motor, health, home and contents… the true value comes into play when we really need it. It is like a silent amour that protects you for any upcoming battles you might encounter with your investment property. As disaster can strike when we least expect it.

When choosing your tenants, there is no doubt you will undergo a strict screening process in the aim of selecting the best tenants for your property. However, life does happen, and with that can come unexpected circumstances that are out of your control. That is where landlords insurance comes into play.

What does Landlords Insurance Cover You For?

Landlords Insurance covers you for tenant-related risks that are not covered by home and contents insurance. It helps to cover your rental property, the items you provide for tenant’s use and your rental income.

More specifically, landlords insurance covers you for:

  • Theft or burglary by tenants or their guests
  • Malicious damage or vandalism by tenants or their guests
  • Damage from fire, theft or storms
  • Loss of rent due to tenant default or damage
  • Legal expenses required to evict a tenant
  • Liability cover

Tax Benefits

Not only is landlords insurance a necessity, it is also tax deductible. Another positive is in relation to other insurances out there, landlords insurance is very affordable, sitting at a cost of approximately 1.5% of rental income.

Considerations when Choosing a Landlord Insurance Policy

When conducting your research, there are some questions to keep in mind and confirm with your insurer.

  1. Are there any additional risks your property needs covered? (ie storm / flood)
  2. Will you allow pets?
  3. Does the policy cover malicious damage as well as theft?
  4. Will you rent the property furnished or unfurnished?
  5. How long will you cover loss of rent? At what stage will this kick in?
  6. What is the excess when you need to make a claim?

Do note each insurer is different and we recommend thorough research into all providers and to read their PSD before making your selection. Be sure to take note of what is and isn’t covered as well as the excess payable if you are required to make a claim.


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