The last couple of years has been turbulent for just about everyone, but while we’re here we’ll consider this for property investors specifically. The turbulence may not be over, but while it might seem there’s uncertainty around each corner, one thing is certain – landlord insurance can and should not be lived without.
For property investors we’ve seen everything from eviction moratoriums, rent reductions, some even rental grace periods since pandemic 2020 kicked off and although this all took us by surprise, we’re savvy investors right? We’re prepared for most anything to eventuate thanks to our strategies, financial buffers and insurances.
Considering what’s past is the perfect method for arming ourselves for the future so we thought we’d look at a few reasons why landlord insurance is such an incredibly wise investment for an investor …
Landlord insurance will be there when you need it
Choosing not to have it or to “self-insure” might save you a few hundred in the short term, but if something goes wrong – repairs, loss of rent, large scale damage – you could be spending MUCH more than what you thought you’d saved. You’re spending money on something you may never use, but when it does come to claim time you’ll quickly forget the cost of your policy.
It’s there when you need it, and the right policy covers all sorts of issues you might struggle to foresee. Oh, and on the plus side, it’s likely you can claim premiums as a tax deduction.
Not everything is in your control
The right landlord insurance can help you recoup loss when things that are completely out of your control come around. For instance, even the best tenant can have their own troubles that leave you out of pocket… illness, divorce, death or the loss of a job can impact your rent being paid.
There could be something as simple as a burst waterpipe that causes massive damage to the property and the tenant’s contents. You don’t want to be paying for TVs, computers as well as your property repairs when something like this happens, you want your insurance to cover it!
We can show you policy options and give you the complete rundown on what can be covered by your landlord insurance.
Again, it’ll be there when you need it.
Not all tenants are created equal
If a tenant intentionally fails to pay rent, does a runner or even decides they won’t pay and won’t leave, it’s not just the loss of rent you’ll be looking to recoup it’ll also be legal bills associated with whatever the scenario is. If you’ve dealt with a lawyer before, you’ll understand how quickly these bills can add up.
It’s important to be aware that ONLY specialist landlord insurance covers you for rental losses and legal bills like these. Again, our team can walk you through what a policy could look like for your investment property.
Bad tenant or not, you still might need legal help
If someone is injured or dies in your rental property as a result of something that you may, or may not have known to be an issue, you could be liable for damages. If your tenant decides to sue, you may not only have some form of payout to wear, but also the legal bills associated. Many policies cover this kind of event, so make sure you understand the clauses yours contains. Speak with our team to make sure you know what you’re covered for and we can look at options if there’s things you’d like to be covered.
Water, Fire, Earth
Yep, the weather on Earth can throw curve balls at any time. It might be flood, unforeseen earth movements or bushfires, you don’t want your property to be substantially affected without the means to repair it. Not only will repair costs be large, your tenant will be unable to live there or pay rent. What’ll save you here? Your insurance cover.
Crime
It can come in many forms and for property investors there might be some you don’t consider immediately. For instance, if you’ve failed to repair a lock that was reported broken in a timely fashion and a theft occurs, you’re liable to pay up for stolen goods.
What if your tenant is seriously running a drug operation from your property or decides they like all of your tap fittings and dishwasher as they depart the lease?
The right insurance can be there to help fight the financial cost of crime that we all hope we don’t have to experience.
Clearly, we’re massive advocates for landlord insurance and with good reason. So, if you’re a property investor with or without landlord insurance, speak with our team about finding the right policy for you – they’re not all created equal and it’s always worth ensuring your cover is the right fit for you and your property.
Call us on 1300 469 840 or send us an email to start the conversation.
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