Being a landlord means you’re responsible for protecting your tenanted property against anything that might cause a loss of value or damage to your investment. This is on top of being in charge of maintenance and repairs, security installations and making sure the premises are fit to live in and in good condition.
On the other hand, your tenant carries the responsibility of protecting their belongings kept at your property.
Landlord insurance is a financial safety net designed to protect you as a landlord and property investor against some risks associated with renting out your home. These risks may include:
If you’re renting out a fully or partially furnished property, you might look into getting a landlord contents policy for the following items:
Should your policy cover malicious damage, your insurer may help cover the costs for repair. However, they may charge a more expensive premium for this.
Both are typically the same, except the former is for people that live in a property they own, while the latter is for investment properties you rent out. Landlord policies then have the option to add cover for events like loss of rent, tenant default and malicious damage.
There’s no legal obligation for landlords to take out landlord insurance before leasing their property. However, your lender may require that you take out insurance as a condition of your home loan if it’s secured against your property.
With that said, if you’re a landlord, it’s all the more important to protect yourself from the unique risks associated with leasing your property, like:
Having landlord insurance could give you peace of mind and help cover certain financial losses from your rental property.
Your exact level of coverage will depend on your insurer and landlord insurance policy. The inclusions and exclusions highlighted in the table below are based on an analysis of different Product Disclosure Statements (PDS) from insurers on our panel and does not cover all insurers or products that are in the market.
| What’s covered? | What’s not covered? |
| Damage to your home caused by defined events (i.e. fire, theft etc). | Loss or damage caused by:
|
| Burglary or theft by tenants or their guests. | Loss, damage or injury caused by tenant neglect, carelessness or your failure to maintain or repair your property. |
| Loss of rental income during repairs if the property becomes uninhabitable due to an insured event. | Actions of the sea (i.e. king tides, tidal waves etc.) |
| Legal expenses associated with tenant disputes. | Pet damage and actions of trees (i.e. tree lopping or felling). |
| Legal liability in case of damage, personal injury or death that occurred in connection with your property. | Loss or damage caused by terrorism, nuclear contamination or acts of war. |
| + Accidental or intentional damage to your home and permanent fittings and fixtures (i.e. carpets, walls, built-in cabinetry, etc.) caused by tenants or their guests. This is covered by ‘malicious damage’ cover, which may cost extra to add to your policy. | Landslide or subsidence unless it happens as a direct result of a:
|
| + Loss of rental income due to tenants defaulting on payments. This may be an optional extra for your policy. | Loss or damage caused by any illegal activity you may be involved in. |
N.B. Before deciding on a landlord insurance policy, it’s important to read the PDS for exclusions, cover limits and terms and conditions.
The cost of landlord insurance (your premiums) will vary depending on your insurer, policy, cover options and risks associated with your property.
As a general rule, your landlord insurance premiums are tax-deductible, as well as other expenses associated with renting out your property like:
Before making any decisions about your tax return, consider speaking with a professional (e.g. an accountant).
You can compare quotes from some of Australia’s best landlord insurance providers with our free comparison tool in just minutes. We can help you find great-value cover against risks to your investment property and certain belongings you’ve leased to your tenants!
