Landlord Insurance ?

From: Paddy in the Paddies

My 2nd rental property will come on line soon and I just realised that I don't have any landlord Insurance, or whatever it's called, even for my initial property.

So I interested to hear suggestions, experiences and costs for this insurance item. Plus is it possible to get discounts for more than one property ? For that matter are discounts possible for the standard House and public liability Insurance, for volume ?

Thanking all you wonderful folk in advance.

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Reply: 1
From: Ray Summerton

Give CGU Insurance a ring in your capital city. They will give you a quote and answer all your questions. They seem to be very reasonable for the cover they give.
Regards Ray
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Reply: 1.1
From: Martin .

The lovely people at the RE office who say such nice things about - well, everything! seem to be so reputable and discerning that, as they are screening the prospective tenants, surely there won't be a problem?

Why lose another week's return on insurance when the people who finally make it through the rigors of the applications will be likely to leave your vacant edifice in far better condition than when they moved in!

Still, to lie in bed, and imagine domestic disputes of the scale of WWF going on throughout the newly installed kitchen where you forgot to install the three ropes 4ft clear of the walls, could cause enough worry to warrant the payment of yet another insurance policy.

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Reply: 1.1.1
From: Felicity W.

I've had two situations where I've had "perfect" tenants and up until they left they were. Then one lot broke the lease early, and the other ones... well, they split up and the woman seemed to think she could remain in the property indefinitely without paying rent. We had to evict her.
Moral of the story? For the sake of around $200-250 a year per property, instead of losing around $5000 over these two incidents, I claimed on insurance and it only cost me $1000.
Personally, I would NEVER have a rental property without it. After all, it's not just the tenants from hell trashing your property that you're insuring against.
Keep smiling
Felicity :cool:
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From: Ian Parham

G'day Patosan & All

Getting back to your questions...

I have been with CGU for some time (3xIPs) approx values 135, 160 & 190K respectively (insurance values to cover accordingly).

Cost of policy will vary depending on extent of cover/value...but mine are between $170 - $275 per annum.

There are a number of organisations acting as agents for CGU such as St George Bank; these agents can supply the policies for you much cheaper than going through CGU direct. Just shop around , ask your lender if they have CGU Ins available???

Now the crux...

This year I have had to claim on repairs to a sliding glass door ($$$) after a break in and also a sizeable claim on tenants absconding (readvertising, cleaning, court costs, loss of rent....lotsa $$$). Both claims were processed painlessly (simple claim form), and in quick time (2-3 weeks) direct credit to bank account.

I will be renewing my policies with CGU until such time as I experience difficulties. I will not simply change insurance company because someone else is cheaper!!....unless others can assure me the service is of an acceptable standard.

Either way it is a must have!

Regards Ian
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From: Brian Haynes

Tenants from Hell- My wife and I are currently awaiting the outcome of a
Landlord’s claim with CGU. The agent submitted it a considerable
number of weeks ago (or so the agent said). We are yet to have any
contact back.

The tenant moved in 15 months prior- House , at 8 years old, were in as
new condition.

The tenant , after some 9 months, fell behind with the rent (some 8
weeks at the end) Taken to the Tribunal (twice) and were finally evicted.
The husband, in fits of rage, was smashing holes in the plaster walls, (as
well as beating up his wife. They left 2 large bin loads of rubbish behind
( I mean the truck big bins) Car bodies also had to be removed. Broke
windows and showers screens.

The husband was carrying out vehicle repairs on the lounge room
carpet, and cleaning them in the shower recesses.

The neighbours had called the police numerous times. and had started
to look elsewhere to live. The wife was not coping with three small
children and a baby.

In all the whole place had to be cleaned , fumigated, painted and
repaired for some $5-8,000.

The agent picked these tenants having been the agent immediately
prior. I feel that the agent is answerable for chosing the tenant.

Trouble from the beginning- Monies owed everywhere, ripping off
Centrelink. and now no where to be found.

I have an insurance claims background so it will be interesting as to the outcome
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From: Ian Parham

G'day Brian & All

Sorry to hear of your property/tenant troubles Brian...I think everyone here shudders at such news. I truly hope CGU come to your assistance.

Have you made contact with CGU claims dept. to check on the claim status?

Also, have you insisted on your property manager supplying you with a copy of the full claim paperwork / complete & comprehensive itemised breakdown of said claim?

As I mentioned earlier, I have had no problems with CGU; they have been responsive. I just feel that with the magnitude of your claim, I sense you may have to drive your property manager to push the issue and represent you from their end by putting up the complete case history of the damages sustained.

Basically, CGU will only respond to the information given...or the lack of information given! For instance, my recent claim involved some 22 pages of relevant documentation for a simple default of rent (absconded), cleaning costs (no damage), and court lodgment fees.

As for any direct recourse on the property manager knowing the 'calibre' of these tenants....i'm sorry I can't offer anything on that front. That I think would have to be dealt with in a legal environment...and you would have to be able to prove your case (the agents verbal that he knew the tenants previously wouldn't be would certainly need to source retrospective documentation to prove it). Have any other forumites been down this path, and can offer some input please????

Please feedback on this Brian, or keep us all posted on the eventual outcome.

Hope it goes well!

Regards Ian
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From: Aaron Dwyer

I just had a quote from CGU that seems a lot higher than the prices that Ian mailed about.

Landlords cover with 100,000 for building, with their optional loss of rent and optional default on rent.

Quoted price 434.92, being 220.75 for building, 90 for tenants default, 14.16 for loss of rent, 39.5 for 10M in liability cover.

Am I missing something here. Thats a far cry from 250-270 per annum.

Do you have the options for tenants defaulting and loss of rent while repairing any damaged caused, etc??

Any ideas why I'm quoted so much?

Aaron Dwyer
~ To know and not to do, is really not to know at all.
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From: Felicity W.

I'm not sure, but my insurance doesn't have a building insurance element because in units/flats/apartments/etc the body corporate covers the building. I don't have any landlords insurance for a stand alone property.
Normally the insurance covers a small amount for fixtures and fittings.
Keep smiling
Felicity :cool:
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From: Ian Parham

G'day Aaron & All

Please excuse my oversight...remiss of me!

No you aren't missing anything. I have a unit which has experienced defaulting tenants so I have this area covered. details below.

Unit (without building component, as it is covered by Strata):

$20,500 contents $100.30
$8800 Loss of rent $8.54
Rent default/Theft by Tenant $90
$5000000 Liability $27
Fire Service Levy $37.78
GST $26.36
Stamp Duty $23.19

Total $313.17

I also have two houses with exceptional long term tenants whom I don't perceive to be a risk (my prerogative!)so I have no rent default cover on these two properties. Note: should I have a change in tenants I will immediately initiate cover for defaulting tenants/loss of rent.

Otherwise the details of the two houses are very similar to eachother.

$132600 Building $199.47
$5000000 Liability $27
GST $22.65
Stamp duty $27.40

Total $276.52

The reference $275 as the upper ceiling on my earlier post was using last years figures....$313 is current. I apologise for posting out of date data...certainly not intentional!!!

Aaron, clearly the policy premium will vary depending on the bells and whistles hanging off it as you have found.

Nonetheless, have you had quotes from other institutions? Are they higher or lower for same coverage?
Also have you tried for CGU quotes through the likes of St George Bank or other third party agencies?

Regards & Apologies...Ian
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From: Ian Parham

....Further to my previous post

After a subliminal prompt, from an esteemed fellow forumite, I feel the other side of Landlords Ins policies should be mentioned in order for people to have the big picture in mind for consideration / comparison of prospective Insurance policies.

"Excess payable"

CGU in reimbursing monies for defaulting tenants / loss of rent will recover, apart from the 'basic' policy excess of $100.00, a sum of $400.00 excess from each claim. You will receive the leftovers, so to speak, up to the maximum claim allowed for your circumstance.

Note: CGU have varying degrees of excess payable dependant upon the type, or nature of the claim ie: willful damage by tenant attracts an excess of $400.00 also. However, if damage is caused by earthquake the excess is only $250 plus basic excess of $100.

I can't shed any light on other insurers re excess, but I would be very interested if others would contribute on this area of policy. I do envisage that similar built in costs would prevail with other companies policy.

Some insurers may have higher premiums to be paid but may offer lower excess rates???

To take things further, one might then consider how much their premium will increase upon the next policy renewal should a claim be lodged and paid out???

Swings and round-a-bouts to me ;>)

Cheers Ian
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From: Felicity W.

Hi Ian
I had two claims a couple of years back for 2 properties, and without digging out the files, I'm sure at least one was CGU.
There was no obvious rise in premiums at the next renewal, nor in the excess of either premium.
Mind you, I've noticed my latest renewal the premium has risen and so has the excess - but as there was a general explanation note included with the renewal, I don't think that just applies to me!
Keep smiling
Felicity :cool:
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Reply: 2
From: Terry D

Hi Patosan
Sorry for the late reply but I hope these sites may be of some help.
I got quotes from all 3 & found the aon one to suit my situation.
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