Do I really need landlord’s insurance, or can I save by not shelling out for it? It’s a question that’s probably crossed every property investor’s mind at some point. The answer? A resounding yes.
“It’s a must for all property investors,” says Michelle Valentic of Advantage Property Consulting. “It’s only a small, tax-deductible expense that could end up saving landlords thousands of dollars in the long-run.”
And, in the case of Terri Scheer Landlord Insurance, which costs less than $1 a day, it could cover a laundry list of tenant-related risks.
Need specifics? Here are all the possible circumstances landlord’s insurance will cover you for.
Even if you’ve done your due diligence and picked the best tenant, you’re still not guaranteed smooth sailing. “Your tenant’s circumstances can change and that can affect them financially or how they look after the place,” says Valentic.
And, if you’re in the business of short-term rentals or holiday homes, that’s even more true – particularly as you will be doing less background research on the tenant at the start.
A landlord’s insurance policy designed specifically for short-term rentals, like Terri Scheer Short Stay Policy, will ensure you’re covered should anything happen.
The next thing landlord’s insurance will cover you for are unexpected natural disasters or accidents in the home. Breaking or leaking water pipes, and area fires and floods can and do happen. And insurance will have your back.
“It gives the owners peace of mind, knowing they can continue to cover their mortgage while they’re going through this stress,” says Valentic. “They have the insurance there as a safety net.”
Pets can be another big (but adorable) issue for landlords. “More and more tenants are having pets in their property and they can cause damage to floors and gardens,” says Valentic.
“We’re finding more insurance companies are actually increasing the benefits they are now paying out for damaged caused by pets in properties.”
Subletting is another potential problem for landlords. If your tenants have organised someone who isn’t on the lease to live in the property, they won’t have met you and might not treat the property as well as someone who has.
Plus, without being on the lease, they can avoid becoming accountable for any damages. “That’s where insurance can assist you as well,” says Valentic.
And finally, landlord’s insurance will cover you for any minor incidentals that may come up.
Say, for instance, your tenant had to move out unexpectedly. The insurance will cover for the loss of rent, as well as for any cleaning, repairing, leasing and advertising fees you may be subjected to, says Valentic.
Moral of the story? Get landlord’s insurance.
CLICK HERE for further information
While it is no secret cracking into the property market is tough right now, this report can help buyers identify regions that have the most affordable homes in each city and region across the country. Click here to read more.
So how can you get into your own place as quickly as possible while still paying the rent? We asked a financial adviser for his tips on what renters can do to increase their chances of buying. Click here to read more.