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Most landlord insurances will not cover rent default claims on periodic leases.
Not sure if this applies in "what" states, but we're under the impression that once a tenant has had a 12 month lease in an IP, they then have a legal right to monthly tenancy if they so desire .i.e. they don't have to sign a new 6/12 month lease.
Have I got that wrong? Our IPs are all in Vic & Qld.
In any case, we've never had any serious problems with this method, but that doesn't necessarily mean it's best.
LL