Landlord Insurance

Landlord Insurance

OMG my mortgage is huge – do I really need landlord insurance too?

The short answer is yes! Landlord insurance is insurance cover for property owners who are renting out a property to tenants. And it’s pretty darn important.

Let’s be real about this. Property investment carries inherent risks – especially if you depend on rental income to cover a portion or all of the mortgage. Unfortunately, no amount of tenant screening or security protocols can predict with full certainty what will happen during the lease of your property.

And you are responsible for responding to day-to-day maintenance requests and even emergency property maintenance.

Aren’t I already covered by home and contents insurance?
No. While most general home and contents insurance policies will typically cover you for things like damage to the building, some contents like fixtures and fittings, as well as theft, fire, storm and so on, they won’t protect you against tenants who don’t care as much about your investment property as you do.

Landlord insurance is designed to protect you from bad tenants and malicious behaviour and damage.

What does landlord insurance cover?
Landlord insurance can cover you in case of:
❏Theft by the tenant or their guests
❏Malicious damage by tenants or their guests
❏Legal expenses if you take action against a tenant
❏Liability if a claim is made against you

And the most crucial element of landlord insurance that isn’t covered in alternative policies is loss of rent. Whilst not all policies will protect against all potential situations, most tend to cover the three most common issues:

❏Default – the tenant ceases rental payments (whether remaining in the property or moving out suddenly; death of the tenant may also be covered)
❏Tenant eviction – the tenant has been asked to leave the property
❏The property is not tenantable (due to flood or fire, for example)

Your landlord insurance is also tax deductible … so keep your receipts for end of tax year.

What price would you put on peace of mind?

Use a reputable property manager …
… or your insurance company won’t pay out. You must use a licensed property manager to source your tenant, otherwise your policy won’t be worth the paper it’s written on. Proper background checks must be carried out on all tenants living at the premises.

Landlord insurance and strata
If your investment property is a strata managed apartment or townhouse, you may already be covered for the building and legal liability for public areas. Ask your body corporate: Do I need landlord insurance? What does the strata insurance policy cover me for?

Can I afford it?
At around $380 per year, the question really needs to be ‘Can you afford not to have it?’

Mirren can help you find the right landlord insurance for your properties needs. We help Australians achieve financial security through strategic property investment.

Let us help you.  Contact Mirren today.