We’ve heard it all before: “My tenants are fantastic, they would never do any damage to my property. I don’t need landlord insurance!” And that may be true. Your tenants may be the best the world has ever seen, but you still need to have Landlord Insurance. Here’s a few reasons why:
- If your house is damaged in a storm or flood, you not only want the building’s structure to be covered, but also the loss of rental income if the tenant needs to move out while it is repaired.
- If your tenant suddenly loses his job or falls ill, they may skip out on paying rent because they can’t afford to.
- Even though your tenants may be amazing, but what happens when cousin Deano comes to stay, gets drunk and sets the house on fire while trying to light the barbecue? Your tenants may be great but you never know who their friends and relatives are.
Natural Disasters There are many more scenarios where you may need to put in a claim and it is always worth shopping around to find the best deal for you. In a country like Australia, you definitely want to make sure you have cover for any natural disasters, because you never know when Mother Nature will come calling. If I have Landlord Insurance do I need Contents Insurance? People often ask if they really need contents insurance if they are renting the property unfurnished? The answer is yes, if you have carpet, curtains and furnishings etc. As a general rule of thumb, the landlord pays the insurance for everything they own, and the tenant covers the insurance for their personal items.
As I said in a previous article about disputes over damage, always carry out regular inspections and document any damage that occurs at your property. No insurance policy can cover everything that could potentially happen so it is important to read through all the fine print to find out what you are covered for and what your excess will be. When you have paid hundreds of thousands of dollars on an investment property, it is worth it to spend another $300-500 to ensure you have the best insurance to protect you in case something goes wrong?