There is much debate about landlord insurance, whether you need it or not, and more importantly what to consider when selecting the right policy. Landlord insurance is a policy that will cover the property’s owner for any financial losses connected to a rental property.
Here are 6 useful points you need to consider when you are looking for an insurance package.
- Always check the terms and conditions. Always check your policies inclusions and exclusions. Premiums are often filled with other features and inclusions that you may not have been initially aware of.
- Pay attention to the cost of your landlord insurance as you don’t want your premiums to take up a large sum of your rental income. This doesn’t necessarily mean that the cheapest premium will be the best. On average Sydney landlords are only paying 1.5% of their rental income on their insurance.
- Consider beforehand the level of insurance you may be after. Different levels of coverage are required whether you are renting out a furnished space or just a building.
- Are you allowing pets on the premises? Pets have the potential to do a lot of damage to a property. Does your policy cover accidents or damages caused by animals?
- Consider the location of your property. Do you need to consider any specific risks? Is the area prone to flooding or cyclones? These factors will come into play when deciding on a price and level of coverage of your premium.
- Does your policy help protect you from theft, malicious damage/vandalism, loss of rent due to tenant default and legal expenses if required to evict a tenant? An unlikely situation, but it’s priceless to know you are covered.
Policy coverage will vary from policy to policy so it is important to shop around. Ensure you read all policy disclosure statements and compare a wide range of policies via the CANSTAR website.