Why would you not have landlord insurance?

You hope you never have to use it, but if you do, you are glad you have it!

I can never understand why property investors don’t invest in it, when for less than a week’s rent they can rest easy in the knowledge they have ticked all the boxes to minimizing risk.

But not just any landlord property insurance. My first tip is to use a company who specialises in landlord insurance. It can be like comparing apples and oranges. But when you have health or car insurance companies, even banks offering landlord insurance it could even be a pear.  

Let’s look at the type of insurance required….

As a property investor you need a landlord building policy unless your building is covered under a strata company policy. In addition, it’s essential to have landlord contents to cover the floor coverings, light fittings, window treatments, dishwasher, air-conditioning etc etc. The tenant will be advised to take out their own contents policy to protect their interest in personal belongings and furniture.

The landlord insurance policy that often gets missed is probably one of the most crucial when it comes to minimizing risk.

Circumstances can change in a tenant that may mean they have no ability to pay rent or they choose to make poor decisions, abandon property etc.  

Loss or rent means you can rest easy in these circumstances. This type of policy will also cover you for malicious and accidental damage, changing of locks, garbage removal and pet damage among some other items.   There are very few insurance policies that will cover meth contamination for usage, which can be just as damaging as a manufacturing.  Sadly, with drugs being the biggest scurge in society, it’s na?ve to think it won’t happen to you. You can find a very cost effective policy that includes your contents and loss of rent for less than a weeks rent.

If you are not sure, ask your Property Manager to provide you with a few options for the right cover. Don’t leave it to a company you have always used or worse shop around on price. The cheapest will not help you if it doesn't have the right cover. Ask your Property Manager the questions you need to know to compare apples with apples.  

Author | Donna Gordin | Home 2 Home Realty | Mt Pleasant | Rockingham