Claiming on landlord insurance due to COVID-19

Discussion in 'Property Management' started by Simon Hampel, 10th Apr, 2020.

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  1. Simon Hampel

    Simon Hampel Founder Staff Member

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    Sydney
    I thought it would be a good idea to consolidate some of the information about landlord insurance in one thread to make it easier to find information.

    Here is what I've found so far by reading various insurer websites:

    EBM Rentcover: COVID-19 update: FAQs and the impact on landlord insurance

    I have been told I can't issue breach and termination notices - is this correct and how will insurance respond?

    We know that some peak real estate bodies have advised landlords they are unable to issue breach and termination notices, while others are saying it is business as usual. This comes on the back of the government's proposed eviction freeze. Until the government gives firm direction on what landlords should do, we are unable to offer any guidance on whether landlords should or should not follow normal procedures (and how our policy will respond during this time). Once we know more, you will know more.

    If the government moves forward with its proposal to ban evictions and freeze rents, how will this impact my cover?

    At the moment, regulations and changes are still being discussed. Without knowing all the finer details of the government's proposal, we are unable to tell you how this will impact cover. However, once concrete measures are put in place across the country, we will be ready to evaluate how this will impact cover and will update our clients. In the interest of being open and transparent, we want to tell our clients that: Yes, the changes will somehow impact insurance (big or small - we do not know). And, we will work with our policyholders to understand the situation. Check back here for updates.

    This is a time for leniency and we have recognised our tenants need help. Can we avoid sending late notices and change our processes? What is acceptable and will this impact insurance?

    We know this is a tough time for everyone and people want to do their part to support one another. So, if landlords want to put measures in place to support a tenant through this difficult time, that is up to them. This is how insurance may impact a couple of scenarios:
    • Reducing rent: if a landlord agrees to reduce rent, they cannot claim for the difference in payments (e.g. if you reduce rent from $500 a week to $250, you cannot recoup the extra $250 a week through your insurer). However, if the tenant continues to default on the newly agreed upon amount, you may have a claim. Using the example above, if the tenant still has trouble paying the $250 a week, you could submit a claim for rent default (however, we would determine the payout amount on the new weekly rent of $250 and not the original $500).
    • Putting rent on hold: again, if a landlord wants to suspend rent for a couple of weeks while the tenant gets back on their feet, this would not be covered as it is a mutual agreement and not an insured event. However, if the tenant does not catch up on payments, normal protocols should kick in (e.g. breach notices) and then it would fall under loss of rent and the policy would respond.
    • Not issuing late notices: until the government provides more information, we are unable to offer any guidance on whether landlords should or should not follow normal procedures (and how our policy will respond). Once we know more, you will know more.
    ... read more
     
  2. Simon Hampel

    Simon Hampel Founder Staff Member

    Joined:
    9th Jun, 2005
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    10,137
    Location:
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    I couldn't find any information relating to COVID-19 claims on the following websites:
    • Terry Sheer
    • Budget Direct
    • Allianz
    • AAMI
    • GIO
    • CGU
    • QBE
    • Youi
     
    Last edited: 10th Apr, 2020
  3. abc_123

    abc_123 Well-Known Member

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    ACT
    I asked Suncorp for information RE my policies and they refused to say anything at this stage,

    Like it how landlords are expected to immediately fold and give rent decrease before it is even law but the insurers can basically all just completely remain silent and no pressure from government at all even though they know full well we are waiting to hear from our insurers before we can agree to anything.
     
    Michael Mitchell and Dan Wood like this.
  4. jared7825

    jared7825 Well-Known Member

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    Location:
    Qld
    I called Suncorp last night and was told there are no changes to existing policy, follow the procedure for breach and notice as per a normal claim. From reading the Qld proposal there is nothing to stop issuing notices, tenant just doesn’t have to comply and can ignore them
     
  5. Angel

    Angel Well-Known Member Premium Member

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    Paradise, Brisbane
    Thank you @Simon Hampel, you are doing a fantastic service. Much appreciated.