100% increase in landlords insurance premium

[starbright]

Hi guys

Had a bit of a surprise this month when I was charged more for my landlords insurance premium. Usually I pay $64 and $66 per month for two properties. This month I was charged $130 and $66, thinking they doubled up.

Upon querying them, was told that "Unfortunately rates have increased since last year and timber homes now also have a 20% loading. The policy has been renewed automatically and the monthly payments are now $130.24..."

Wow. Looks like I will be looking for another insurer!

 

[wylie]

Wow. Looks like I will be looking for another insurer!

That is a bit extreme. Get on the phone and find another. We have only timber homes and haven't been slugged with 20% increase (Brisbane). We did have an increase, but I called our insurer and they knocked $100 off the $250 increase.

 

[travelbug]

Are you talking about building insurance with landlord insurance combined?

Or just landlord building insurance? ie not covering rent arrears etc (just the building)?

 

[starbright]

It's a combined building and landlords insurance, building ins for $160k or $180k, and LL on top of that. I think it covers malicious damage and untenantable weeks, but not rent in arrears.

Was charging $66 pm after discount which I thought was on the high side already, but since they had paid a claim previously, I stuck with them through several increases.

Now other previously uncompetitive quotes (terri scheer) will look very attractive unless they have also hiked premiums for timber houses

 

[Doovalacky]

If you pay yearly my insurer gives a $44 discount.

But even if I take off the discounts for yearly payment, multiple policies, 5year customer and no claim it works out at roughly $60 a month. $500 excess.

No flood cover since mine are safe in that regard.
Storm, public liability, rent default covered. 300k for the house which is high but what the bank wanted.

 

[travelbug]

It's a combined building and landlords insurance, building ins for $160k or $180k, and LL on top of that. I think it covers malicious damage and untenantable weeks, but not rent in arrears.

I'd be checking your policy. Malicious damage is covered in your building insurance. That's NOT landlord insurance. Companies call it landlord building insurance. Increasing the excess from $500 to $1000 can save nearly $200pa.

Also $160-180K will not rebuild your house if it burns down. Check that NOW. You need replacement value otherwise you are under insured.

 

[Player]

Timely thread. I just emailed our (former) insurance broker, merely as a courtesy as all the insurances that he had arranged for the past few years fall due today

...........Hi N,

trusting you are well. Initially I wish to thank you for your attention to our
insurance requirements for the property portfolio over the past few years.

Further to the significant increases in premiums this year and having done some research, I have elected to go it alone and secured re-insurance of the entire portfolio for significantly less than CGU (and even QBE for the comm retail shop).

Two of them were nearly half price and with flood cover. My entire saving by taking this into my own hands now is approximately $ 2500.
A not insignificant amount, I am sure you will agree.

Once again, thanks for your efforts in the past. We obviously will not be requiring your services from hereon.

Regards,
Player.....................

His firm looked after all but four property insurance requirements. After not having changed insurer for the past four years and the premiums escalating, this year was the final straw. When questioned about decent flood cover for our pending move from Melbourne to Qld, he had no idea of the product he was pushing. I actually read PDS.........best to know what exactly is and isn't covered.

His firm was good in the beginning, however lately in a comfort zone. Basically printing the renewals, stapling them and posting. That'll be 70 buck$ per policy thanks. Nothing proactive for a number of years.

Most of these were single houses......picked up the phone and rang a round a little and the svaings came in kerching.

The most difficult was a block of units (in one line), however Westpac was found to be adequate for this and with flood cover.

Moral of the story? Pick up the phone folks and keep insurance brokers accountable for those who use them. My time input was 1.5 hours total to re-insure the entire stable. Saving 2.5 K. that money (irrespective of its tax deductibility) is better in my pocket. Nearly 1700 bucks an hour for those calls. Not bad

 

[starbright]

Also $160-180K will not rebuild your house if it burns down. Check that NOW. You need replacement value otherwise you are under insured.

Thanks. I thought homebuilders could build a brand new brick house for $180k these days, was told the rates psm they are doing now go as low as $900-1000 psm when I have been through displays in new estates. As my place is an old highset timber house not brick, I thought that was enough to cover replacement costs.. Will check and bump it up if required, thanks.

 

[Doovalacky]

Don't forget demolition costs of damaged structure, the internals such as carpets/blinds and all the little other things it takes to finish of a house.

 

[Sheryn]

Thanks. I thought homebuilders could build a brand new brick house for $180k these days, was told the rates psm they are doing now go as low as $900-1000 psm when I have been through displays in new estates. As my place is an old highset timber house not brick, I thought that was enough to cover replacement costs.. Will check and bump it up if required, thanks.

Starbright

You have to allow more for removal of destroyed building, costs incurred whilst no income coming in, new DA to build house etc. We have our IP's insured for 100K more than they cost us to build and it does not cost that much more to do so.


Regards
Sheryn

 

[bernly]

The annual building insurance on two apartment complexes in which I have an interest has just been renewed for $6,000 and $9,000 less than quoted by the original broker.

It certainly pays to shop around and if you don't want to do the phoning around yourself just try another broker as we did. It seems to still be a very competitive market and it doesn't hurt to play one broker against the other. Some insurance companies like Zurich are just not interested in certain areas of the market and so have priced renewals ridiculously high in order to offload business they don't want. You definitely don't want to deal with a lazy broker.

Cheers

 

[wylie]

Don't forget demolition costs of damaged structure, the internals such as carpets/blinds and all the little other things it takes to finish of a house.

Do be careful with this area though. I had our houses over-insured (better over than under) and when I renewed recently, I mentioned on the phone (direct call to the company - not a broker) that I had made the figure higher to allow for demo, clearing and dumping (architect???) fees.

Reply was that these are automatically included in the policy, and that the figure I pick for the house doesn't need to be increased to cover this.

And no... I haven't actually read the 56 page PDS because the figure is still probably high enough to cover extra.

The only way to check would be to actually read the PDS, but don't just assume you need to add demolition, clearing and dumping fees on, as they may already been automatically covered.

 

[macca446]

paying to much

I have 3 properties insured with Tica Insurance NSW cost $265 year QLD $225 a year other states a bit cheaper and comes with 15 weeks rent default as well as many other benefits all investors I recommend.

 

[babushka]

same here - almost double insurance premium

We have encountered a similar increase in rental property insurance. We have received a renewal invoice from EBM for a rental property in Brisbane. Last year we paid $672 for both building & landlord insurance, this year the premium will be a whopping $1,142 . So, I guess we will have to phone around for new quotes. We would appreciate some suggestions please! Thank you.

 

[Kaz111]

We have encountered a similar increase in rental property insurance. We have received a renewal invoice from EBM for a rental property in Brisbane. Last year we paid $672 for both building & landlord insurance, this year the premium will be a whopping $1,142 . So, I guess we will have to phone around for new quotes. We would appreciate some suggestions please! Thank you.

I'm joining your club with EBM. A $600 odd renewal last year has escalated to $850 this year. Hmmm

 

[elsLan]

You don't have to get both building and landlord cover with the one insurer.

Personally, my building cover policies are with GIO and my landlord policies are with EBM. EBM offers the most comprehensive and specific cover including accidental and malicious damage along with Terri Scheer.
Their building cover policies are much more expensive only because they simply don't have the quantity to offer huge discounted rates as they do with landlord policies. This information was discussed with Yolanda Webster who is the Vic/Tas EBM client manager.

You will find most bank or general insurers have huge excesses and don't cover all the events that actually occur during or at termination of a tenancy.
EBM also offer a policy discount for multiple properties. They also have no excess for-
1- some loss of rent claims
2- tax auditing costs
3- key/lock replacements
The policies are also fixed premiums so claims do not affect your premiums
My PM was able to obtain 5 landlord policies for $208 each for 12 month cover.


Insurance is something to definetly research as much as you can while deciding what events and item specific aspects you need to include.
Shop around and dont fall for lower premium/higher excess on anything other than major events like fire/flood. If you do, when you need to claim its not worry it as the excesses combined are often more than the costs of repairing the resulting damage and that's just pointless.

Liz

 

[babushka]

You don't have to get both building and landlord cover with the one insurer.

Personally, my building cover policies are with GIO and my landlord policies are with EBM. EBM offers the most comprehensive and specific cover including accidental and malicious damage along with Terri Scheer.
Their building cover policies are much more expensive only because they simply don't have the quantity to offer huge discounted rates as they do with landlord policies. This information was discussed with Yolanda Webster who is the Vic/Tas EBM client manager.

You will find most bank or general insurers have huge excesses and don't cover all the events that actually occur during or at termination of a tenancy.
EBM also offer a policy discount for multiple properties. They also have no excess for-
1- some loss of rent claims
2- tax auditing costs
3- key/lock replacements
The policies are also fixed premiums so claims do not affect your premiums
My PM was able to obtain 5 landlord policies for $208 each for 12 month cover.


Insurance is something to definetly research as much as you can while deciding what events and item specific aspects you need to include.
Shop around and dont fall for lower premium/higher excess on anything other than major events like fire/flood. If you do, when you need to claim its not worry it as the excesses combined are often more than the costs of repairing the resulting damage and that's just pointless.

Liz

Thanks, Liz. Your plan is good - keep building insurance separate from landlord insurance. We did both with the same company - well, broker, EBM, for the sake of convenience. But, now we will need to do more research on this.

 

[Pa1nter]

We have encountered a similar increase in rental property insurance. We have received a renewal invoice from EBM for a rental property in Brisbane. Last year we paid $672 for both building & landlord insurance, this year the premium will be a whopping $1,142 . So, I guess we will have to phone around for new quotes. We would appreciate some suggestions please! Thank you.

I automatically paid mine with EBM last week and after reading this tread I thought I would take a look ,not so bad,it increased from $950 to $1120,this is their householders rental policy in NSW.
It also covers $1000 a week from loss of rent,

 

[babushka]

I automatically paid mine with EBM last week and after reading this tread I thought I would take a look ,not so bad,it increased from $950 to $1120,this is their householders rental policy in NSW.
It also covers $1000 a week from loss of rent,

You are lucky, Pa1nter, that the increase was incremental. Ours appeared to be phenomenal! Not sure if ours was typical for properties in Brisbane. I will check with our property manager there as well.

 

[tvadera]

Hi All,

I have Bldg + LL cover (Rent Cover Platinum) with EBM. Last year my premium was 643 for a prop in VIC, this year premium is 862 (30% rise for what)

Time to shop around, thanks SS members for pointing out the imp of shopping around and not giving in to those absurd price rises.

Regards,
TV

I'm joining your club with EBM. A $600 odd renewal last year has escalated to $850 this year. Hmmm