Do You Need Landlord Insurance?
Rental properties can bring several unique risks and challenges when you’re a landlord. Whether it’s your own property or you’re managing it on behalf of the property’s owner, you need to be appropriately protected against anything that might go wrong.
What does Landlord Insurance cover?
When looking after the property and the contents provided for your tenant’s use, Landlord Insurance covers your property for damage as well as any loss of income you might sustain while the property is out of action.
Choice and flexibility - Do you also require building Insurance?
For flexibility in your landlord cover, we also arrange Rental Protection Plus Landlord Insurance, which gives you flexibility to choose the cover you need and also include building insurance. Simply apply online or call us today for more information.
COVID-19 FAQs for Landlords
As the rapid spread of Novel Coronavirus (COVID-19) continues to cause significant disruptions globally, we at Aon recognise our critical role in managing the impact on our customers. The implications for landlords and tenants continues to rapidly evolve, therefore we have provided answers to the following most frequently asked questions in relation to your coverage. Please note given the fluidness of the situation, these responses may change, and we will keep you regularly updated. We hope this assists in these uncertain times.
Q. What occurs if following unemployment due to COVID-19, a tenant wants to break their lease due to financial hardship?
A. Coverage may be available under the rent default section based on hardship, but the normal rules of termination will apply subject to the policy terms and conditions and coverage limits.
Q. Can rent default be claimed if the tenant is unable to pay rent due to COVID-19?
A. Yes, this is claimable under the rent default section of the policy. Please refer to the Landlord Insurance PDS.
Q. Can a shortfall be claimed if you and your tenant mutually agree to a reduction in the weekly rental payments?
A. No, the difference in weekly rent is not claimable as this is a mutual agreement between you and your tenant.
Q. Can rent default be claimed if you and your tenant mutually agree upon a suspension of their rental payments?
A. No, as this is a mutual agreement between you and your tenant.
Q. Are there any restrictions in place should a landlord wish to take out a new Landlord Insurance policy that might cover a COVID-19 related event?
From 5pm AEST, Friday, 3 April 2020, CGU will not be able to offer ‘Rent default and theft by a tenant]’ cover on new policies. The cover will remain on all existing policies.
CGU is committed to helping customers through this difficult period, so we will continue to offer cover for Contents, Loss of Rent and Liability on new Landlord Insurance policies.
Insurance is intended to protect customers from unforeseen events. During this difficult economic period, it is likely that some tenants will struggle to meet their rental payments and that cover for ‘Rent default and theft by a tenant’ is not unforeseeable and therefore it is not appropriate to offer this cover on new Landlord Insurance policies.
This will continue until further advised.
Q. If a tenant were to die inside a leased property from COVID-19, will Landlord Insurance cover a forensic clean and property fumigation?
A. No, however clean-up costs up to the bond amount are permitted as per your lease agreement for reletting expenses.
Q. In the case of a death of a tenant due to COVID-19, how long will rent default cover apply for if the property remains vacant?
A. Landlord Insurance is available to cover the loss of rental income due to the death of a tenant provided that tenant was the only person named on the lease. The policy will pay up to 15 weeks rent with a six-week reletting period. Please note that a $12,000 maximum limit applies.
Q. It may be the case that COVID-19 may cause a decline in the demand for rental properties. If the tenant’s lease is about to come to an end and I am unable to secure another tenant due to lack of demand in the rental market, will losses be covered?
A. No, the policy does not respond to rental market fluctuations.
Q. If the tenant advises the agent/landlord of a trip overseas and then abandons the property following country lockouts and falls into rental payment arrears, how will insurance respond if it is deemed a claimable event?
A. This is claimable under the rent default section of the policy. Please refer to the Landlord Insurance PDS.
Q. What is the claims process should I need to make a claim?
A. We have a 24-hour claims hotline. Please call 1800 105 900 to lodge your claim over the phone.
In these uncertain times you may have questions that have not been addressed above. Aon and CGU are here to support you, so if you require any further assistance regarding your policy, please don’t hesitate to contact us on 1800 105 900.