Landlord insurance: Am I wasting my money?

When deciding to lease your property, the process can seem pretty simple: find the right tenant, and there won’t be any issues.

Reasonable it may seem, if you’re a landlord fortunate enough to find and secure that perfect tenant. But when there’s grounds to doubt who is occupying your property, or when a situation takes a turn for the worse, what happens next?

The fact is, it’s easy to brush off the ‘tenant from hell’ headlines – the smashed windows, broken doors, trashed interiors – by thinking it won’t happen to me.

While we endeavour to select the best tenants for our landlords at Prudential Real Estate, we follow one simple ethos: there is no way to predict the future behaviour of a person or group.

This is precisely why we recommend that every landlord opts for insurance to cover the circumstances that an agent cannot.

Without landlord insurance, the maximum compensation you can expect to receive for damage or rent owed is the total of the bond; so regardless of what your nightmare situation adds up to, without insurance, a mere four weeks’ rent will be your only buffer.

In many instances, that amounts to the cost of a cleaner plus a coat of paint to one or two rooms (perhaps). And with standard home and building insurance policies not covering intentional damage or loss of rent, it’s a risk that most landlords aren’t willing to swap for peace of mind.

What landlord insurance covers you for

For the most part, landlord insurance will cover your property against damage or loss arising from malicious, accidental or deliberate situations. However, it’s vital to shop around and to know the specifics of each cover, with every insurer having a different policy (and premium).

Our advice

If you’re looking to take out cover, opt for specialist landlord cover only. This excludes policies offered by banks, generic insurance agencies or other non-specialist bodies, who are known to be good-for-nothing when a claim arises – some even providing lower than your annual premium.

Who to choose

Through decades of experience, we can recommend the following specialists:

After more advice?

Speak to our award-winning property management team:
Prudential Real Estate | (02) 4628 0033 | campbelltown@prudential.com.au.

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