Rental properties need a different insurance policy compared to owner-occupied homes. There are additional risks you’ll want covered and there are certain
requirements your insurer will want you to meet too. Contrary to popular belief, insurers don’t want to decline claims! The policy wording/schedule
is a contract, between you and your insurer; the contract defines what is and isn’t covered and your understanding of this policy is essential.
Non-Disclosure and incorrect policy
If you take out a standard home and contents insurance cover for your rental property and fail to tell your insurance company that your property is occupied
by tenants, your insurance company has a right to reject any claims related to the tenancy.
Lack of policy knowledge
Reviewing your policy documents (schedule and wording) for key benefits, limits and exclusions are essential to making informed claims. If you have specific
concerns, don’t wait for an uninsured loss to occur – check with your insurer about the policy coverage.
Weak claim applications and how to avoid them
Insurers need to know the specifics of What happened, When, Where and Why. If you are unable to provide any part/s of this information, you will run the
risk of having your claim delayed and, in some cases, declined. Take photos of
requirements. Initio has lots of information online through the resource
Other helpful tips for savvy property investors
When you take out and renew your rental property insurance:
- If you are not familiar with the location of your rental property, compile a list of local tradespeople in case you need them in the future.
- Maintain a good relationship with tenants to allow ease of access to the property to make repairs.
- Encourage your tenants to keep you posted of maintenance issues.
- Inspect your rental property every 3 months and keep a photographed and written account of the condition of the property.
At claim time:
- Be pro-active and keep the loss as small as possible.
- Have tenancy documents readily available eg: tenancy agreement, tenant references, inspection reports.
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