Landlords' Insurance 

Perth Real Estate Property Management News & Market Insights  |  11 July 2021

A PCR, or Property Condition Report, is prepared by a property manager prior to a tenant occupying a property, as close as possible to the move-in date.

Whether you're already a seasoned property investor or about to become a landlord for the first time, there are many things to consider - and landlords' insurance should be at the top of the list.

Often misunderstood or overlooked, landlords' insurance is different from building, contents and strata insurance. It covers a range of unforeseen events specific to investment properties and tenancies. Furthermore, not all landlords' policies are created equal, so it pays to research the various options available.

For a tax-deductible investment of less than $1.00 per day, a comprehensive landlords' policy can cover events such as;

• Loss of rental income: Life circumstances can change without warning, so if your tenant loses their job, becomes ill or passes away, the right policy can help recover lost rent. Or, if a tenant simply decides not to pay rent and remains at the property, landlords' insurance can assist with the ensuing financial difficulties. Loss of rent may also occur if your tenant needs to vacate the property due to significant damage caused by severe weather events.
• Legal assistance: If you are liable (at fault) for someone sustaining an injury at your investment property or you need to appear before a tribunal, landlords' insurance can cover your legal costs, including court and lawyers' fees and damages.
• Malicious damage: Whether caused by burglars or tenants, landlords' insurance can reimburse you for losses from theft of, or malicious damage to, property fixtures and fittings. Damage can also result from manufacturing drugs (e.g. methamphetamine) on-premises - standard building insurance policies do not include cover for such events - which happen more often than you might imagine.
• Tax audits: Being audited by the ATO can be expensive, with legal and accountants' fees potentially costing thousands of dollars. Depending on the policy, you can be covered in whole or part for these unexpected costs with landlords' insurance.
• Cleaning costs: Whether required due to a tenant's death, malicious damage, weather events or drug manufacturing, cleaning costs are rarely covered by a standard building or strata policy. In particular, trauma and drug lab cleans are exceptionally costly, on top of the loss of rent which is a by-product of such events. 

When selecting the right landlords' insurance policy, the devil is in the detail. As mentioned, it is worth taking the time to explore the different policies available. Xceed Real Estate has found that the following insurance companies offer both comprehensive cover and a positive customer experience:

• EBM Rent Cover
• Terrie Scheer
• Property Insurance Plus

It also pays to remember that a policy is only as good as the person/company managing the property. Your property manager must ensure the required safety checks are completed, including items such as smoke alarms, tree lopping and general maintenance.

For further information about landlords' insurance and Xceed's award-winning property management services, contact us at hello@xceedre.com.au, or call (08) 9207 2088.