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Landlord or contents insurance?

Landlord or contents insurance?

If you're renting out your property, whether it's long or short term, one of the most important decisions to make is how to protect your investment against damage or bad tenants, or being liable if someone hurts themselves on your property.

There are several insurance options available, but finding the one(s) which best suits your needs requires some comparison.

Here, we look at three different types of insurance that you may need as rental owners. 

1. Home Contents Insurance

Separate to Building Insurance, which is compulsory before most settlements take place, Home Contents Insurance covers many of the internal structures and fittings in your home.

What it covers:

Every home and contents policy is different, but most cover:

  • Water damage
  • Essential repairs
  • Fire, flood and storm damage
  • Theft
  • Damage to internal fittings such as curtains, carpets and appliance

What it doesn’t cover:

  • Items brought into your home by friends or visitors
  • Intentional or malicious damage by friends or visitors
  • Permanent structures in the home
  • External structures
  • Portable items you frequently take outside the home such as jewellery (unless expressly specified)

Do of course check the terms and conditions to make sure you have all the insurance cover you need.

If you want cover that will extend to protect you against loss of rent or damage by tenants or paying guest then you also need to consider Landlord Insurance.

2. Landlord Insurance

For people renting their property out permanently, Landlord Insurance is a popular choice.

It not only protects the contents of the home, but protects against damage and liability caused by tenants.

What it covers:

  • Water damage
  • Essential repairs
  • Fire, flood and storm damage
  • Theft
  • Damage to internal fittings such as curtains, carpets and appliances
  • Malicious damage by tenants or their guests
  • Loss of rent due to unforeseen circumstances or break of lease by tenants
  • Legal liability for tenants and their guests

What it doesn’t cover:

  • External structures in the home, for example the roof, grounds etc. from storm, fire or flood damage
  • Loss of rent outside of extenuating circumstances, for example normal end of lease or failure to find new tenants

3. Insurance for the share economy like Airbnb and Stayz

If you rent rooms or your whole property for short and longer term paying holiday guests, through sites such as Stayz and AirBnB, then you'll need flexible insurance cover.

There are a few options on the market, one of which is ShareCover.

A major benefit of ShareCover for owners of short-term rentals is that, unlike a Landlord Insurance policy, it can be taken out for shorter periods of time, which means that while the property is not being rented, owners are not paying unnecessary premiums.

What it covers:

  • Theft or attempted theft
  • Malicious damage
  • Accidental damage
  • Strata property damage
  • Personal liability
  • ID theft
  • Portable and valuable contents

What it doesn’t cover:

  • External structures in the home, for example the roof, grounds etc. from storm, fire or flood damage
  • Loss of rent outside of extenuating circumstances, such as normal end of lease and failure to find new tenants
  • Natural disasters such as storms, lightning, hail, flood, cyclones, earthquake etc.

It's good to keep in mind that one or more of these types of insurance may be required to properly cover your property in both a commercial and personal capacity for renting, so do the due dilligence and check that you have the insurance you need.

You wouldn't hand the keys of your car to someone you didn't know without proper insurance, so don't hand the keys to your precious property over without it either!

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