It’s staggering to realise that almost 95% of Australian population families are under insured (Finder).
For me, this represents an issue for people who are investing in property.
If you’re investing in property, then you’re someone who is trying to create a better financial future for themselves and their loved ones.
And if you’re doing all this hard work to create a better future, then why would you not adequately protect it in case something goes wrong?
But it’s not just the physical asset that you need to protect.
So with this in mind, I’ve recently spoken with 2 Adelaide professionals on the things that property investors need to consider when it comes to being appropriately insured:
Landlord’s Insurance
All property investors require landlord’s insurance. Residential landlord insurance can cover many things, including:
- accidental damage or defined events cover
- residential building cover
- landlords furniture, fixtures and fittings
- loss of rent
- malicious damage caused by tenants
- rent default
- theft by tenant
- flood cover
- liability
Your landlord’s insurance can be tailored to include any number of the above things, and it is important to speak with a qualified insurance specialist to understand the level of cover (or level of risk!) you would like.
However even though a property may be insured correctly, sometimes there can be issues when making a claim. Common (but avoidable!) situations Tracey Miller from TLM Insurance Solutions has seen with landlord claims have included:
- Failure to maintain written records, such as before and after photos of repair work undertaken, or assessments.
- No written lease. If there was never a written lease put in place that was signed by all parties, or if there was one that has since expired – your policy may not cover you for tenants defaulting on the rent.
- Lack of regular inspections. If a property is not regularly inspected, your insurer may deny the claim on the grounds that the issue was the result of gradual wear and tear. Regular inspections of the property can help to provide the evidence required for your claim if the need ever arose.
Thankfully the above issues can be circumvented through the employment of a (good!) Property Manager , whose responsibility it is to maintain adequate written records, to conduct regular inspections of the premises, and to ensure that an up-to-date lease is in place.
Personal Risk Insurances
An area that is often neglected when it comes to insurance (not just for property investors!) is wealth protection. What would happen to your hard earned future if something were to happen to YOU?
If you’re not sure whether you’ve got the insurances mentioned above, please feel free to reach out to me on michael@equidel.com.au. I’d be more than happy to put you in touch with some of my trusted network, who are experts in their fields.
And as I like to say – if you’re going to ‘Invest Property, Invest Properly.’