Is it really though? Roughly how much would you pay each year across your whole portfolio vs how much you have had to claim in the past 10 years?
Even with 10x properties at $300 a pop that is $3000 a year x 10 years = 30k.
A few tenants do a runner in that time and cause some damage? What would you be up for? 15k perhaps? Still not worth it.
I've got considerably more than 10 properties, but I don't spend $300 on each of them. Like I said, I pick & choose which ones get it.
I also don't claim on all things claimable, as I'm aware of the re-percussions of claiming on many minor items.
On the ones where I do spend the full amount, one property has been claimed upon twice. Not just unpaid rent, but lots of damage as well. Probably at least $12k in that one place. Current tenants have been given notice & there will probably be another claim going in.
Another one which has now been sold, we claimed around $5k. A third one has a long term grotty tenant in it. I'm surprised she's still there, because we've upped the rent to well above market rates (would prefer her gone), but these days she pays up pronto. I'd definitely NEVER be without insurance with her, but the timing isn't right at the moment to force her out.
Another property has 2 x 3bedders on the one block. We've got LL on the one at the rear, but the el-cheapo option for the front one. The reason being is that the mother lives in the front & keeps the place spotless & pays rent promptly. The son lives in the back & is grotty & always late with rent. The good news is that if the mother finds out he's behind in rent, he gets a rocket from her & it's paid, but he just isn't the same calibre tenant as his mother.
Another thing to consider is the location of the properties. If they are interstate, or a long distance from home, then I'm happier to pay more than I am for something local, where Hubby can just rock on up & fix things at a low cost.
So...yes, you are right, it is a large cost when you've got a large portfolio, but we manage that cost as best as we can.