Do I need landlord insurance?

Landlord insurance is a policy specifically designed for rental property owners. It’s different to a standard home buildings and/or contents insurance policy, because it caters for the unique risks and events that can come about when you rent out a property to tenants. 

There are three options for landlords who want to take out insurance. You can choose to:

• only cover the rental property’s structure
• only cover the contents inside the rental property, or;
• get cover for both with a combined policy.

Like other home insurance policies, landlord insurance may include cover for damage and loss caused by a fire, flood, and storm. Along with these commonly listed events, it can also help cover some things specific to rental properties, including:  

• loss of rental income (in certain circumstances)
• damage caused by tenants, including vandalism or unauthorised changes
• replacement keys and locks
• removing possessions abandoned by previous tenants. 

Keep in mind that there are many different variations on what's covered by a landlord insurance policy, and sometimes you can add on extra cover, too. Be sure to carefully read the Product Disclosure Statement (PDS) to determine what is and isn’t covered by a policy, so if you ever need to make a claim, there are no surprises. 

While landlord insurance isn’t mandatory, it can come in handy if certain things go wrong. For example, imagine someone steals a washing machine from your rental property, or a storm damages the roof — these are scenarios that could be covered by insurance, helping you avoid the out-of-pocket expense of replacing the machine, or repairing the roof, entirely on your own. 

Even the very best tenants can cause damage to a home. An innocent game of backyard cricket can result in a broken window, requiring the whole panel to be replaced. For circumstances such as these, landlord insurance can be helpful. After all, damage isn’t always the result of extreme weather or malicious activity, it can be as innocent as two kids practising their bowling technique and discovering they may have used a little too much spin!