Just recently, two of our clients have had negative experiences with the Landlord insurance on their rental properties.
In each case, the property was damaged; one by the tenant; the other suffered quite serious water damage. In both cases, their insurer refused to cover the cost of repairs. In the more serious case, the client carefully read the policy, which clearly stated that damage from this exact cause was covered. What actually happened was that the insurer took five months to assess the claim, (including flying a building inspector from interstate to examine the damage), before denying the claim.
Both clients purchased their insurance through the bank that provided the mortgage on the property.
So what’s the moral of the story? There are several to consider:
a) When buying insurance, be careful to shop around;
b) Before handing over any premium funds, be sure to ask specific questions about the cover in the policy, and about any language in the policy that you don’t fully understand;
c) Buying insurance from or through a bank might be a bit like shopping for a haircut at a hardware store – it’s an inappropriate source.
d) If you don’t have time to do the shopping yourself, find an experienced insurance broker who will take the time to listen to your needs, then find you the most suitable policy and cover at the best price.
e) If you can’t find a reliable broker, contact us – we may be able to point you in the right direction.