The right landlord insurance will protect your property from risks as varied as backed-up sewage that ruins the ceiling, spiteful tenants who decide to trash the place and structure damage from fires, earthquakes, floods and more.
The best landlord policy is one that comes from a reputable insurer, and meets your needs at a fair price. Here are some ways you can make that happen:
It's not worth considering a policy that doesn't cover at least the following standard building and contents protection:
Additionally, you should consider protecting yourself against situations that are unique to landlords, although this may require you to purchase an optional add-on typically called tenant protection. Here are some instances where tenant protection can help:
While there’s no single best landlord insurance company, there are a few ways that you can ensure that you’re getting the best policy for you. To get you started, here’s a list of some of the top landlord insurers in Australia:
What should you look for in a landlord insurance company?
A major part of what makes a great policy is the company behind the policy. There are many great companies out there, all with different benefits and drawbacks.
Should you go with Budget Direct or Youi? What about AAMI? You also have Allianz, Virgin Money, NRMA, Real Insurance and quite a few others. You have no shortage of options, so it’s important to size up your choices and pick one that you can trust.
Here are some things you should look out for:
Prompt, friendly and competent customer service. Find out how accessible the support staff is. Can you choose from multiple methods to contact them such as chat, phone and email? What are their hours? Are they open 24/7 or only during limited times?
Straightforward, effective and timely claims process. Your insurer should make it easy to lodge claims and supporting documents – a member's web portal is one of the best ways it can do this. Dig into the policy documents and find out how long it takes to process claims. It shouldn't take more than a couple weeks.
A reputable and financially-sound underwriter. The underwriter is the company that is putting up the money to pay claims, so it’s important that it has a strong financial position. Most underwriters are large institutions with plenty of information about them available online. Read up on how to find out what kind of reputation an underwriter has around managing funds and paying claims.
Positive customer reviews. The Internet is filled with customers sharing their experiences with insurance companies. Find out what other landlords are saying about the insurers you're considering. You can also talk to your rental agency and see what other landlords are saying to them about the insurers they use.
No matter where you are in Australia, you can follow the process above to get the best landlord insurance for you. However, there is one major difference between a few of the states regarding pets, and this can have an effect on whether or not your insurance will help you when you need it.
Not all insurance automatically covers damage from pets, so when buying insurance for your property, make sure you get one that covers you for pet damage like soiled carpets and claw marks on the walls and furnishings.
In Victoria, you can't refuse a tenant's pet without approval from the Victorian Civil and Administrative Tribunal. This means you might be dealing with more pets than usual.
Tenants are required to get written approval in order to keep a pet in a rental property, so landlords can refuse pets altogether. If you do refuse pets, you'll be safe going with a policy that doesn't cover pet damage. It’s important to remember you cannot refuse guide dogs, so occasionally you may need to add pet insurance onto your policy during that tenant’s lease.
New South Wales doesn't have any laws saying tenants can't have pets. However if pets aren't something you are keen on allowing into your property, you can bar tenants from having them by writing it into your contract. If you do refuse pets, you won’t need additional pet cover. If you do allow pets, the additional pet cover will cover your property against stained carpets and scratched-up walls.
In South Australia, tenants are required to get your permission first before allowing a pet to live on the property (guide dogs are an exception –you’re required to let them live with their owners). This gives you a lot of control over how you handle pets and how you structure your insurance accordingly. If you do end up allowing pets, make sure you take out a policy that covers pet damage to carpets and walls.
In Western Australia, the tenant needs your written permission to keep a pet. If you allow it, you also have the right to require an additional “pet bond” of up to $260. If you choose to ban pets from your property, you won’t need to worry about additional cover for pet damage. If you do allow pets, you have the luxury of deciding whether or not the pet bond is enough to allow you to forego pet cover.