One of the most critical purchases that every landlord must make is a landlord insurance cover. You can get protection for damage to your property and rent default with just a few hundred dollars. This investment is important because it is your safeguard against potential huge financial losses from any number of unforeseen events.
For instance, a residential landlord risks financial loss from a tenant who loses his job and becomes unable to pay the rent. Commercial property owners could also have tenants who go out of business. In both instances you could be left picking up the tab. If you are still paying a mortgage for your investment property, you could suddenly be in dire straits.
If you let property, whether it is residential or commercial, you must have adequate landlord insurance cover.
How Landlord Insurance Cost is Computed
Landlord insurance cost varies depending on which insurer you choose. It also depends on your type of cover and any additions (extras and incentives) provided by your policy.
In order to understand your landlord insurance cost you must check what your building cover provides. In general, your policy protects your building’s structure, fixed appliances, fixtures, fittings, awnings, blinds, and plumbing and gas systems. Insurance costs will depend on your level of cover/total sum insured.
Comprehensive landlord insurance cover is more expensive because of additional cover from risks such as accidental damage, malicious damage, theft, rental default and other potential risks. Other policies also provide extra benefits such as legal liability cover to protect a landlord against death or injury of a tenant due to negligence.
As you can see, the cost of landlord insurance depends on the type of cover you have. Cheaper landlord insurance may leave you underinsured and greatly exposed to financial risks. While a comprehensive landlord insurance policy may cost more in premiums it can amount to great savings in the event that you need to make a claim.
It is important to understand the different incentives provided by individual insurers so you know how your landlord insurance cost is computed and what you are paying for.
Obtaining the right level of cover is of paramount importance. You don’t want to lie awake at night worrying about your investment property when there is a storm or flood. Don’t make the assumption that you are covered. If you are unsure, it is better to over insure than to under insure afraid that your policy will not pay out. You think you are saving a lot from a cheaper policy but your total investment could be wiped out in an instant.
Landlord Insurance HQ are brokers that are ready to help you with all your Landlord Insurance Cost enquiries and quotes, Request a quote online or call us on 1300 815 344 for quotes from leading landlord insurance providers in Australia today.