25 October 2021
How to protect your rental property
The four key things to consider before you put your property up for rent.
Are you thinking of leasing a property? Becoming a landlord comes with a lot of responsibility, but the good news is that you don’t have to assume all the risk on your own. Securing the right insurance for your investment property can provide you with the protection and peace of mind you deserve.
Ultimately, Landlord Insurance can be a safety net to safeguard your property and can provide long-term financial security. So, before you commit to a policy, here are four things you should consider.
1. Choose the right kind of cover for the rental on offer
When it comes to rentals, there are all different kinds of properties on the market. From apartments on long-term leases to beach houses used for shorter holiday stays, there’s no one-size-fits-all insurance policy for rental properties.
As a landlord you may choose to rent out your property privately for a 24-month period, or for shorter holiday periods such as weekends through platforms like Airbnb. The fact of the matter is that holiday or shorter-term rentals may have different insurance needs in comparison to longer-term rentals that have a tenancy agreement, so it's vital to check that your insurance covers you for all scenarios.
If you’re renting your property out to long-term tenants, you may want to consider getting NRMA Landlord Insurance. Whereas holiday rental properties could benefit from ShareCover – Holiday Rental Insurance, which is designed for homes with short-term rental guests.
2. Know your rights and responsibilities
There's a lot of legal due diligence and regulation around being a landlord, so if you're not confident managing a property (or you don't have the time), you could hire a professional. But remember, just because you're paying for property management, doesn't mean you are insured against damage.
If your tenants move out with rent owing and leave your property damaged, their bond might not even come close to covering what needs to be repaired or replaced. And if you don’t have Landlord Insurance, you might even be the one left out of pocket.
But with NRMA Landlord Insurance you can feel at ease, because if your tenants stop paying rent or they leave without giving notice, you are covered up to $5,000 in lost rent to ensure your rental income is protected while you find a solution for the situation.
3. Be proactive and safeguard against possible damage
Whether it’s accidental or not, damage to your property can happen. That’s why it’s worth investing in a comprehensive policy which will cover your property from damage caused by a tenant or their guests, an unwanted burglar, or even natural disasters.
For peace of mind, NRMA Landlord Insurance covers your rental property for a range of things, including theft and vandalism, lightening, water and oil leaks, and even impact damage that are caused from things like a fallen tree during a storm or a vehicle that accidently crashes into your home.
Better yet, if your building is covered with us and is damaged after a covered event, we take care of the costs associated with demolishing or removing debris. We also pay up to $1,000 for damage from covered events to renovation materials at your rental property.
Keep in mind that there are many different variations on what's covered in Landlord Insurance, so be sure to carefully read the Product Disclosure Statement (PDS). The PDS will outline what is and isn’t covered by your policy, so if you ever need to make a claim there are no surprises.
It is also wise to consider your excess amount. If you want to be able to claim for smaller items that are say, less than $250, you may want to contemplate whether bringing your excess down will be more advantageous for you.
4. Factor in the property's environment and surroundings
Take the time to investigate your options and choose a policy that matches the exact needs of your property based on its environment or condition. For example, if your property is located near a bushfire prone zone, it's wise to consider a policy that covers potential bushfire damages.
Once you know exactly what you need in terms of premiums and extras that best fit your property, get a quotes for NRMA Landlord Insurance to make sure you get the right policy to suit your specific needs.