As an investor, it is important you are well acquainted with landlord insurance.
Unlike, home insurance, contents insurance, health insurance and car insurance, landlord insurance is not as well understood.
Yet it is equally important for investors.
The Property Investor’s Insurance
Whether or not you have the perfect tenant who wouldn’t dream of ever hosting a rave in your property, landlord insurance is a must.
Whilst it is optional insurance, it is very highly recommended for all property investors. It will help cover your financial losses in what can possibly be very expensive. If COVID has taught us anything recently, it’s that the very unexpected can very quickly, become the new normal.
So we break down what landlord insurance actually covers and more importantly, why you need it.
What is landlord insurance?
Landlord’s insurance is insurance for those who rent their property out to a tenant.
What does landlord insurance cover?
Landlord insurance covers you for any financial losses incurred by loss of rent or property damage. Even the best of tenants can be faced with sudden financial hardship and unable to pay their rent.
Coverage can vary from provider to provider but will generally include:
- Accidental loss or damage to the property
- Damage caused by tenants
- Loss of rent following damage to the property or any other reason
- Loss of rent due to tenant default
- Tenant theft, malicious damage and vandalism
- Legal expenses required to evict a tenant
- Rent reduction
- Death of a tenant
What is the difference between landlord insurance and home and building insurance?
Landlord insurance covers you for the losses/damages/incidents related to the tenants whereas building or home insurance covers the cost of the building repairs and damages themselves.
Why you should take out landlord insurance
Taking out landlord insurance will give you peace of mind that you are covered should anything untoward happen with your tenant and their ability to pay rent or if damage is caused to your property. Additionally, it is a handy tax deduction come tax time.
If you’d like to look into taking out a landlord insurance policy, get in touch with our team to discuss.