Landlord insurance in Victoria

A landlord insurance product typically covers the physical structure of your investment property, including garages or sheds on the property. As a landlord, you’re responsible for protecting your property against insurable events that might cause damage to your investment.
Landlord insurance usually covers insured events like:

• Damage from burst pipes and escape of liquids
• Legal liability cover if someone is injured in the home
• Removal of debris
• Flood cover (may be optional)
• Fire damage
• Storm damage/storm surge
• Malicious damage and vandalism
• Damage from theft.

Landlord insurance is highly beneficial for protecting your investment property from various risks and ensuring you’re covered for structural and content-related (e.g. escape of liquid) issues. Choosing the right type of policy depends on what kind of property you have and the coverage you’re looking for.

Always read your relevant Product Disclosure Statement (PDS) to understand the full details of your insurance policies, inclusions and exclusions, as well as the Target Market Determination (TMD) to ensure that the policy fits your needs.

Landlord building insurance covers the physical structure of your investment house, including garages or sheds on the property, if an insured event causes property damage. However, it only covers structural damage to your property, not the furniture or belongings inside of the property. This insurance is ideal for owners primarily concerned with protecting the structural aspect of their rental property.

Landlord contents insurance covers the furniture and furnishing you provide tenants during a tenancy. It can cover insured events and rental issues caused by tenants such as malicious or accidental damages and tenant or pet damages to your furniture.

Landlord contents cover is ideal for those who furnish their rental properties and want to protect those items from various risks. It’s also helpful for properties under strata policy arrangements, like apartments, where the building’s structure might already be covered separately.

Landlord building and contents insurance is a combined policy that provides comprehensive protection by covering the structure of your rental property and the furnishings you supply to tenants. This all-inclusive policy is ideal for property investors, especially those with standalone houses, as it combines coverage for the building and its contents into a single policy.

Some insurance companies also offer optional covers you can add to your policy to cover things like:

• Loss of rent. Some landlord insurance policies may also offer coverage for loss of rental income if the property becomes uninhabitable due to an insured event.
• Accidental breakage. Cover for accidental breakage of fixed glass, basins, sinks, baths and toilets damaged by a tenant or their visitors.
• Legal expenses. Policies might include legal expense coverage for disputes with tenants or other legal issues related to the rental property.
• Tenant default. Certain policies may protect against loss of rent due to tenant default or non-payment.
• Motor burnout cover. This covers the loss or damage to electric motors if the motor was burnt out from an electric current or power surge.

The cost of landlord insurance may differ for each person, as the insurance premiums are influenced by several factors usually unique to you. Some of these factors can include:

• Location of your property: Your specific location determines your insurance premium. Properties in areas prone to natural disasters (such as bushfires, floods or storms) may attract higher premiums.
• Suburb crime rate: Areas like Melbourne or Yarra with higher crime rates (like vandalism and theft) can result in higher insurance premiums. Insurance providers consider the likelihood of claims related to property damage or loss due to criminal activities. The presence of security systems, such as alarms and surveillance cameras, may help reduce your premium by mitigating the risk of these crime-related claims.
• Sum insured: The total amount of coverage you choose for insurance will impact your premium. A higher sum insured means higher premiums as the insurer’s potential payout increases. The value of the property and its contents also affect the cost; higher-value properties and more expensive furnishings can lead to higher premiums.
• Provider differences: Different insurance companies may offer varying premiums based on their risk assessments and policy terms. Comparing quotes from multiple providers can help you find the best rate.

Some insurers offer first-year or online discounts for people seeking a landlord insurance policy, which could bring your premiums down. If you want an idea of how much your landlord insurance may cost, you can get a quote from our comparison service.

Landlord insurance in Australia is important because it protects property owners and their financial investments by safeguarding landlords from potential financial loss due to damage caused by tenants, pet damages, rent default, absconding tenants and other types of loss of rental income. Having landlord insurance can provide peace of mind and financial security for property owners in case of unexpected events.

Strata insurance is a building cover that insures shared property in domestic buildings (e.g. apartments and townhouses) and commercial buildings (like offices). It’s designed to cover the entire property structure, including common areas. It may cover loss of rent and temporary lodging costs when an insured event makes the property unable to be lived in.

You don’t need landlord building insurance if your investment property has strata insurance. Instead, you can consider landlord contents insurance to protect your furniture and any other contents you provide with your rental property.

No, landlord insurance is not compulsory in Victoria. However, the general advice is to get landlord insurance. As the property owner, you are responsible for any loss or damage to your home and contents and are liable for any injury or death caused by an issue with your property. Landlord insurance can protect you from these financial burdens and offer legal liability for incidents.