A Stitch in Time...

A recent survey carried out by Insurance Australia found that 35% of property Investors did not
have specific landlord insurance on their tenanted properties.

There are many benefits exclusive to landlord protection policies that are not available with
normal home insurance policies.

A major benefit is where your tenant 'disappears' or falls behind in their rent, and then breaks
lease. If you have the right insurance policy you will be covered for any loss incurred.

The other big benefit is where your tenant or their friends damage the property. A good landlord
protection policy will also cover your investment property for malicious or deliberate damage.

A landlord protection policy is tax deductible and usually only costs around an additional .00 per
week.

It is not all good news so here are some points to consider if you are about to take out landlord
protection policy:

o Make sure that your tenant is not in arrears at the time you take out the
policy, as with some policies this will impact on your ability to claim for lost
rent.
o Illegal activities are not usually insured. As an example, if your tenant was
growing marijuana and damaged the property, the insurance company
could well have an 'out' because the activity is illegal.

Some insurance companies can make life really difficult in the way they assess a claim. For
example, if a tenant was to deliberately damage a wall and a door in your investment property,
how would that damage be viewed by your insurance company? If they viewed the damage as
one claim there would be no problem. On the other hand, if they were to look at the incident as
two different claims, you could well have to pay an excess fee on each claim.

There are some really excellent policies available, but as usual, the devil will be in the detail.

I would suggest that you speak to an experienced insurance broker who has a number of
insurance companies in his or her portfolio. That will ensure that you get the best advice and a
policy that will suit you.

It requires some research to find the right policy, but as an investor, I suggest that you don't leave
home with out one.