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What Landlord Insurance Covers
Landlord insurance covers building damage, lost rent and legal liability for owners who rent out residential property.
Cover applies to the building where you own it, landlord contents, rental income and legal liability. It deals with the risks a tenanted property brings: damage, malicious acts and rent default.
Whether you own one investment property or a portfolio, landlord insurance is the base cover for Australian residential investors. It is a different product from home and contents insurance. It sits within our personal insurance range at Fortis Risk Solutions.
Landlord Insurance: Cover Sections and Benefits
What Landlord Insurance does not cover
Landlord insurance answers sudden loss and tenant related damage. It is not a maintenance fund, and it will not fill the gap left by an informal tenancy. Common exclusions are:
- Wear and tear, and the fair marks a long term tenant leaves behind
- Gradual water damage, rot, mould and rust, including a shower that has been leaking slowly
- Loss of rent where there is no written tenancy agreement, or where no condition report was completed
- Malicious or deliberate damage that was never reported to police
- Damage while the property is left vacant beyond the period stated in the policy
- The building itself where the property is a strata apartment, since the owners corporation policy covers the structure
- Short stay letting through booking platforms, unless the insurer has agreed to that use
Landlords commonly require certificates of currency from their agents and trades, and the same discipline works in reverse. FRS checks the tenancy type, the managing arrangement and the vacancy history against the policy wording before each renewal.
How Landlord Insurance premiums are set
Insurers price the building, the address and the tenancy. Rent received matters far less than most owners expect. The rating factors are:
- The cost to rebuild the property, plus the value of landlord contents such as blinds, carpets and appliances
- Property type: a house, a unit, or an apartment where only fixtures and improvements are yours to insure
- Address exposure to flood, bushfire and storm, and the age and construction of the building
- Tenancy type: a long term lease, student or share accommodation, or short stay guests
- Whether a licensed agent manages the property or the owner manages it directly
- The loss of rent period selected and the limit for tenant damage
- Claims history and the excess chosen
Agent managed properties usually rate better because inspections and records are consistent. FRS compares landlord insurance across insurers on the same limits, since the loss of rent and tenant damage sections vary far more than the building section does.
How to claim on Landlord Insurance
Tenant damage and rent default claims stand or fall on the tenancy file. Entry and exit condition reports, inspection notes and the ledger are what an insurer asks for first. The FRS process:
- Contact FRS as soon as the damage or the arrears are known, and do not wait until the tenant has moved out
- Make the property safe and stop further damage, keeping receipts for emergency work
- Report theft or malicious damage to police and record the reference number
- Photograph everything and hold damaged items until the assessor has seen them
- Gather the tenancy agreement, condition reports, inspection records, rent ledger and any notices given, and take the usual steps to recover unpaid rent
- FRS lodges the claim, deals with the assessor and coordinates with your managing agent so nothing is missed
Our make a claim page sets out what to send.
Landlord Insurance compared with Home and Contents Insurance
| Question | Landlord Insurance | Home and Contents |
|---|---|---|
| What it covers | The building, landlord contents, loss of rent, tenant damage and liability to tenants | The building and everything you own inside the home you live in |
| Who buys it | Owners renting a property to tenants, directly or through an agent | Owner occupiers |
| Typical trigger | A tenant leaves owing rent, damage found at the exit inspection, storm damage between tenancies | A burst pipe, a burglary, storm damage to your own home |
| Sits with | Strata insurance where the property is an apartment | Private motor |
Moving out and renting the house is the moment the cover has to change. A home policy has no rent default section and no tenant damage section, so landlord insurance replaces it, or sits alongside strata insurance where an owners corporation already covers the building.
Landlord Insurance FAQs
Landlord insurance is written for rental properties. It adds cover for tenant-related risks such as rent default and malicious damage, which a standard home policy does not usually include.
Loss of rent after insured damage is commonly included. Rent default cover is separate and subject to the policy terms and conditions.
Landlord policies differ widely in tenant damage definitions, waiting periods and sub-limits. As your broker, FRS helps you:
- Clarify what the landlord, the tenant and the owners corporation each cover
- Structure loss of rent and rent default cover
- Compare policy wordings, not premiums alone
- Handle claims involving tenants and property managers
If the property is an apartment or townhouse, we check your cover against the building's strata insurance. Owners who also let commercial premises need a separate policy.