As a property owner, it is important to familiarise yourself with exactly what your insurance policies cover you for and what the differences are, between landlord and building insurance.
Generally, landlord insurance will provide you coverage for
- Loss of rental income
- Tenants leaving without notice
- Damage caused by tenants
- Your property becoming uninhabitable due to fire, burst pipes etc
- Theft by tenants
- Rent default
- Contents of landlord
- Liability
- Flood
- Clean up costs because of illegal drug production
Building insurance protects against damage to a property’s structure and extends to the garage, outbuildings, perimeter walls and pools.
It is important for investors to insure their property for the full cost of reconstruction otherwise any claim payment may be reduced.
Investors need to be aware that the full cost of reconstruction is the cost of rebuilding your property, not the market value.
Investors should always notify their insurance provider whenever their property is being tenanted.
Building insurance should cover the property for:
- Fire
- Lightning strikes
- Storm damage
- Fallen trees
- Explosions caused by gas leaks etc
- Earthquake
- Vandalism
- Vehicular collision with building
- Water damage
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