This is a tough question because everyone’s insurance needs are different and the type of policy you need can depend on the location of your property. Most policies don’t insure you against white ants or flood but some do against fire. So when choosing an insurance policy it is imperative to read the policy closely and ask as many questions as you feel necessary.
Landlord insurance covers property owners against malicious damage by tenants, accidental damage, legal liability for actions on the property that cause death or bodily injury and loss of rental income as a result of property damage or a tenant doing a runner.
Terri Scheer Insurance Manager, Ms Carolyn Majda, believes that “uninsured landlords really need to think about how they would manage financially if they were faced with thousands of dollars’ worth of damage to their rental property, or were unable to relet their property while repairs
were being made.”
This is made easier by choosing a landlord insurance policy that provides the necessary level of cover. Ensure that when you choose the policy that you check not only the initial cost but also any excess payable on a claim. Some policies may
appear to offer great value for money until you actually make a claim. Some may only offer you cover when your property is tenanted but not for when a tenant does a runner or worse still – dies and your property is left vacant. Some policies cover you for damage but you will need to check
that this includes both accidental and malicious damage by the tenant.
Ms Majda recommends the following key questions
to ask when choosing a landlord insurance policy:
1. What is the level of cover provided for ‘loss of rent’?
2. Does it cover accidental damage as well as malicious damage?
3. Does it cover legal liability?
4. Does it cover your contents?
5. Does it cover you for the cost of a tax audit?
6. Can you place your cover online?
7. What is the total contribution you will be required to make towards a claim?
8. How long will it take for a claim to be paid?
9. Can you always speak with a customer service
representative?
