There is one insurance claim in particular that poses a great financial risk to landlords, according to Terri Scheer Insurance.
In fact, 53% of claims made by policy holders in the 2014-15 financial year were for loss of rental income.
“More than half of claims made by landlords were caused by absconding or defaulting tenants,” said Carolyn Parrella, Executive Manager of Terri Scheer Insurance.
“A tenant who falls behind in their rent poses one of the greatest financial risks to landlords. Arrears can be a very long and costly process to resolve.
“Many landlords are still unaware and unprepared for these risks.”
The second largest issue for landlords is malicious damage caused by tenants.
This includes things like holes punched in walls, doors that have been kicked in and intentional damage to carpets and floors.
“Tenants who damage a rental property can leave landlords with large clean up bills and significant replacement costs,” said Parrella.
Other popular claims included water and storm damage, legal liability and theft.
"A standard buildings and contents insurance policy generally won't cover landlords for many of these risks," said Parrella.
Top 10 landlord insurance claims for 2014-15
- Loss of rent
- Malicious damage
- Water damage (contents)
- Legal liability
- Storm damage (building)
- Water damage (building)
- Theft (contents)
- Fusion (contents) – Provides cover if a motor in a household electrical machine or appliance needs to be repaired or replaced because the motor has burnt out by electric current at the property.
- Storm damage (contents)
- Impact damage (contents) – Provides cover if impact by motor vehicles or water craft, aircraft, space debris or satellites, falling trees or branches or TV antennae, satellite dishes or radio masts.
Source: Terri Scheer Insurance
Do you have more than $200k in your super fund? You could use your super to buy property - Find out how
Top Suburbs :
Get help financing your investment
Do you need help finding the right loan for your investment?
When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.
Just fill in a few details below and we'll then arrange for a local expert Aussie Mortgage Broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus, our mortgage broking service is at no cost to you.
We value your privacy and treat all your information seriously - you can check out