Australian Mortgage and Loan Information

Landlord Insurance or Landlords Insurance as some call it, is a necessary cover for all rental property owners who are serious about making a success of their chosen asset investment.

The rental property road is littered with obstacles, none more apparent than the need to have tenants. I list tenants as obstacles, as many a well intentioned property investor as had their dreams shattered by a rip-off tenant. Surviving the experience they say makes you stronger, but for many it is the last straw. Many leave the property investing game after a bitter experience with a tenant.

Unless you count Tony Soprano as a close personal friend, Landlord Insurance. is the only way you can protect yourself and not feel so violated when a tenant walks without paying rent or wrecks your investment property.

The cost of a policy can vary wildly, but if you can get cover for around .2% of the replacement value of your property or an amount equal to three weeks rent you are not paying to much. I am always prepared to pay a little extra for a lower excess.

Things you need to be covered for as a minimum are:

Loss of rent due to rent default.
Loss of rent due to death of sole tenant.
Loss of rent due to an insured event e.g; fire, flood, storm damage or damage to a neighboring property that may restrict access to your property.
Legal costs for evicting a tenant in default of rent.
Building replacement, impact, storm damage and flood cover.
Theft, or malicious damage by tenant or visitor.
Personal liability at least $20,000,000
Accidental glass breakage.
Replacement of locks and keys.
Contents cover for fire theft and malicious damage.

These are the basics, a qualified insurance broker can give you the complete picture. Be sure to read the terms and conditions of the policy before you purchase. Get three quotes if you have time. Most landlord insurance providers let you pay monthly, so you can use your cash flow from the property to fund the premium. Or you maybe able to get it deducted from your mortgage. You cannot afford not to have this cover. The Bond money you get from a tenant is never enough to cover the damage they do.

I also advise you to make friends with a plumber. Tenants are always blocking drains or breaking taps.