Will Insurance pay out if no PM?

[ritchie77]

To cut a long story short:

I purchased IP in May in Brisbane.... had insurance locked in with Suncorp and gave then details. I said there would be a property manager managing the house because this was my intentions once settlement finished.

However, the vendor asked to rent the house off me while they finished building theirs for 3 - 6 months. I agreed to this but due to carelessness did not change my insurance to reflect this (and also because I thought it would not metter??)

Anyway, now I have received notification that the cooker blew up and may need fixed by an electrician or even a new one altogether!! TYPICAL...

Anyway, do you guys think the insurance company will still pay for this? They do not check if PM do they?? Or shall I contact Sumcorp and change the insurance policy (I dont suppose it will cost extra will it??) and then organise the repair after I contact the insurance company??
Or shall I just pay for it myself and include it as a deduction because it may not be insured anyways - However I beleive it should be??

Cheers guy
Ritchie

 

[BV]

Ritchie
Is this landlords or building insurance?
In this instance I believe it doesn't make any difference but do update your policy details because it can be important with other types of claims (loss of rent, tenant damage etc...)
Cheers

 

[Stella]

As Ritchie says, make sure you update your details now as you'd hate to give the insurer a way out of paying!

We had the same thing happen after the tenants were in for 3 days and just paid the sparky to fix as needed -replaced a couple of blown elements for $220. However, had the whole stove needed to be replaced I would probably have investigated the insurance possibilities.

I didnt consider it claimable on insurance, more just as general wear & tear/maintenance?

Someone please correct me if I'm wrong....
Cheers
Stella

 

[wylie]

For goodness sake, do not try to do anything that is fraudulent. If it was me, I would call Suncorp. I would think that whether you have a PM or not would not affect the cover, if it is indeed covered under the policy.

As far as landlord insurance is concerned, plenty of companies insure self-managers. We self manage and Comminsure cover us. Other companies too, but cannot remember who we were with a few years ago when a tenant did some damage. Some insurers will not cover if you self manage.

Anyway, this sounds like building cover, so I think you will be covered anyway. But do not put your reputation at risk by doing anything dodgy. You may find you can never get cover again if you do something silly like that (not to mention you could go to jail for fraud).

Wylie

 

[ritchie77]

OK thanks for the advice guys......

I will contact Suncorp today and advice of situation but I think it may only need fixed now so probs just a general deduction for repairs and maintenance...

 

[clucker]

I'm assuming you have sorted this by now, but just to clarify. There are certainly some companies that will only insure a rental property if professionally managed, but there are others that will insure either way.

There are a multitude of products out there today, many from banks etc., but you are likely to find that the specialist products are more comprehensive in a wider range of circumstances.

The three largest of these are RentCoverUltra from EBM Insurance Brokers (underwritten by QBE), Terri Scheer (underwritten by Vero) and Aon (underwritten by CGU).

All are good products, the EBM policy is available whether managed or not, the Aon policy is too but there may be differences in what you get if you buy direct, but the Terri Scheer policy is only available if managed.

Whatever your situation is it is best to disclose it but with the EBM RentCoverUltra policy it definitely will not make a difference (whether managed or not) in a claim situation. EBM also have what's known as "claim settling authority" whereby they settle the claims on behalf of the Insurer, which can have some advantages, in particular the speed of settlement.

I hope this helps.

 

[Xenia]

As others have said you need to make sure all is upfront. Companies like Terri Scheer will not even insure you if you do not have a pm the risk is too high for them.

I never really understood this until I became a pm and started getting things from private landlords after an attempt to rent properties privately. They are a nightmare to sort out!!! There is half done paperwork or outdated lease contracts that they pulled out of a draw somewhere, bonds incorrectly lodged, rent undervallued for the area, rent paid in arrears etc...

Or is this all because people look for a pm only after things go wrong

 

[clucker]

Or is this all because people look for a pm only after things go wrong

I expect that may be the case. Some private landlords get it really right as they care so much for their own property, but those that just want to save paying management fees because they think they know better often come unstuck, and need a professional to bail them out.

That said, I would always recommend landlords get their properties managed professionally, there are too many rules and law changes for the average person to keep up with. Most property management companies I know well and truly earn the fees they charge, and they're worth every cent.