Aside from property maintenance and keeping tenants happy, you also need to consider having landlords insurance in place. This cover provides you with peace of mind for when things go wrong such as damage to the property by tenants.
What is landlords insurance?
Landlords insurance offers broad protection for landlords. It is one of the most important investments you can make as a landlord as it offers financial cover when things go wrong at the property. Your landlords insurance can cover events such as damage to the building and its contents as well as issues such as damage caused to the property by tenants. Even if you have a property which isn’t worth a significant amount of money, remember that you need to protect your investment as it could cost you thousands, and even hundreds of thousands of dollars, if things go wrong.
What to look for in landlords insurance
When it comes to landlords insurance, you need to make sure your policy suits your situation and is adequate for the value of the property. It is recommended that you read and understand your policy and what cover you have when natural disasters such as storms, fire and flooding strike. It is common for people to opt that both the building and contents of their investment property are covered. Sometimes your body corporate will cover the building on one group policy if your property is on a joint block such as apartments, villas or units, so it is worth checking this with them and understanding what the cover includes. This policy will generally not cover contents in your property so you may consider a landlords contents policy. Although tenants need to cover their own personal possessions, you should consider covering certain items in the home such as carpets, blinds, appliances and any included furniture with a contents policy. In terms of building cover, this should cover the actual structure of the property as well as items such as pipes, gas and plumbing systems, and fixtures and fittings.
Landlords insurance can give you peace of mind in case you get a bad tenant as it can protect you against issues with your tenants including damage that a tenant causes in the property, loss of rent cover, default of rent, theft by your tenants, vandalism and liability cover.
How much will landlord insurance cost?
As with any form of insurance cover, the cost of landlords insurance will depend on a number of factors. These include the amount of properties you’ll be insuring, the value and location of the properties, and the level of cover you want to have in place. If you choose a more basic policy with lower premiums, you can expect to have a lower level of cover. Before you take on a landlords insurance policy, be sure to read through the inclusions and exclusions to ensure that you have the right level of cover for your situation. The last thing you want is to find yourself underinsured when it comes to claim time.
Landlords insurance for an investment property is tax deductible and it provides security against the financial risks that come with owning an investment property.
For more information about landlords insurance, contact CGU today.