For those of you wondering, landlord insurance is an agreement covering owners of a property from damages incurred.
Damages caused by fire, flood or storm to exterior facades or contents of a building– such as curtains, carpets, light fixtures, built-in wardrobes and kitchen cupboards – landlord insurance.
Alternatively, if your tenant or their guests hurt themselves on your property and a claim is made against you – landlord insurance.
If your tenant turns nasty and vandalises your property or leaves without paying the rent – landlord insurance.
So what doesn’t it cover?
Landlord insurance provides no coverage on things such as trees, shrubs, grass or anything growing in the ground. So, if you’re about to rent out your house with its prize-winning azalea garden, beware.
Horror story, anyone?
Domain Senior Product Manager Melanie Hoole recounts the time she rented out her family home to what seem to be your “tenants from hell”. “They tampered with every electronic device – including the security alarm system. They drilled through the floor to install wiring, The dogs – which we hadn’t given permission for in the contract – scratched up the floor. There were broken windows and tiles. It took us a day to realise a whole window pane was missing. The pool turned green, as they’d stopped cleaning it.” To make matters, worse, the tenants then refused to leave the house, taking Hoole 7 weeks to evict them. By then, they had already caused $13,000 in damages.
Fortunately, Hoole had landlord insurance, which had come up for renewal just before the tenants were due to move out. As she already had her suspicions about the renters, she’d decided to renew the insurance. “The insurers were fantastic,” she says. “They paid out everything.”
Landlord insurance, essential?
Whilst not every tenant is a “tenant from hell”, landlord insurance definitely comes in handy; Hoole recommending this because in the end, “you really never know”.