Property Investment News | Landlord Insurance

Why landlord insurance is a wise investment.

It has been a turbulent couple of years for the investment property industry and the trend is likely to continue well into 2022.

While some things change, one thing remains clear – landlord insurance is a wise investment. If COVID-19 has taught us anything, it’s that the rental world can change quickly and it is easy to get caught up in the aftermath.

Restrictions and government-mandated actions, like eviction moratoriums, were imposed. These had financial ramifications for landlords and those who had insurance found themselves in a better position than those without.

Fast-forward to today and it is a case of “never say never”. No-one knows what lies ahead and how it may impact the rental market and landlords. That is why landlord insurance is still a wise investment.

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No-one needs insurance – until they do!
Insurance can seem like a waste of money, especially if you don’t need to make a claim. Deciding to “self-insure” (e.g. cover the risk yourself) may sound like a good way to save money, but it’s often a false economy. You may save a few hundred dollars in insurance premiums, but if something goes wrong at your rental, and you’re left facing a repair bill and the loss of rent, those savings will be wiped out and then some.

Beyond your control
Even the best of tenants can have things happen that mean they can’t pay their rent –  unemployment, illness, divorce/separation, death. The right landlord insurance can help you recoup those losses.

Not paying and not leaving
Some tenants who turn out to be far from ideal. As a landlord, you could find yourself dealing with the financial hole that’s left if your tenant fails to pay their rent.

Accidents happen
You can have the best tenants in the world, but your rental might suffer accidental damage. Things get spilled, things get knocked, things get broken. It just happens.

Weather woes
Mother Nature can be very unpredictable and there’s no telling what will happen when wild weather strikes. Bushfires, storms, cyclones, floods and hail can all cause significant property damage. Without insurance, you are left to pay for the repairs yourself. And don’t forget, you may also suffer loss of rent if your tenants must move out because of the damage.

Water works
You might be surprised just how often landlords need to make a claim for damage caused by a water pipe bursting and flooding the home. One burst pipe can result in thousands of dollars in repairs. Landlord insurance can cover water damage, if the cause of the damage is an insured event.

If you have any questions, or need clarification on any of the above, please contact Anna Marten, our Head of Property Management, on 9651 1666 or anna@guardianrealty.com.au.

Important note: Clients should not rely solely on the content of this newsletter. All endeavors are made to ensure the content is current and accurate however, we make no representations or warranties as to the accuracy, reliability, completeness, or currency of the content. Readers should seek their own independent professional advice before making decisions.

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