Sandhu’s story is an alarming one. After termination and eviction, groups (that may or may not be affiliated with the tenant) arrived at the property on separate occasions to cause significant damage. By the time the story was reported, Sandhu’s property had been completely destroyed.
While the extent of maliciousness, in this case, is unusual, damages to rental properties (ranging from accidental to malicious) are not uncommon. Since landlords have little control over how properties are treated during the tenancy, the best time to handle damages is before they happen. And that means being particular with aspects of your insurance policy relating to damages and loss of rent.
Related video: What if your rental gets trashed
Rene Swindley from Initio Insurance shares some insurance takeaways for landlords based on Sandhu’s experience:
✅ Not all landlord policies include a loss of rent cover; check that yours has it. If you are with Initio, don’t worry; loss of rent cover comes with all of its landlord policies.
✅ There are generally two types of loss of rent cover: one addressing the loss of rent while the property is being remediated and another addressing tenancy failures such as arrears and abandonment. Not all loss of rent cover/add-ons includes both.
✅ Be very careful about the sum insured figure for loss of rent. A $20K maximum cover would go very far in areas like Te Awamutu but not so much in Auckland.
✅ Vacant houses are vulnerable. Oftentimes your insurer will apply a higher excess when a property is left vacant for a long period of time and/or broaden the policy to cover specific perils (such as fire, storm, or earthquake). Make sure...
