New IP - Building & Landlord Insurance

Hello all, I’m looking for building and landlord insurance for an IP that is going to settle in about 60 days time. I’ve tried to get quotes from Terri Sheer and EBM but they only allow policies to start within 30 days and won’t offer landlord insurance until I have a tenancy agreement in place. Is this the normal practice?

So far I have a quote from Allianz who is able to offer me coverage, can anyone share their knowledge on their insurance coverage or claims experiences with them? Might have to go with them if I want to get this sorted earlier…

Thanks!

 

That really doesn't sound right, you want a landlords insurance policy in place before it is leased so you have PL cover when showing prospective tenants through. TSI & EBM should do this, they have a thing on the form that says start date which just cannot be back dated, they also have rental amount or estimated rental amount, basically if it's more than $1k/week then they slug you with an additional premium, I think that's the reason they ask this and/or to get an indication if it's not yet leased etc. I'm an authorised distributor for TSI my forms are different to general consumer though. I've never had issues signing my clients up for the stuff mentioned above.

 

There are at least three or four types of LL policy...possibly more.

1. Building (NOT for strata property as the strata will insure the building)
2. Landlord contents (either strata or not) and
3. Extra LL cover ie rent options etc
4. Short stay specialist policies which are different to 3. in they insure things that are not a "residential tenancy lease".

Some people have a seperate building policy to that of LL as contents and LL can be stand alone OR with building. Does usually help if its the one insurere as some events can be claims under different elements of the one policy. eg Tree hits roof, building damage, damaged contants and claim for lost rent. This can be a very helpful thing in some claims and how repairs are co-ordinated and assessed and approved.

Normally the Building / Contensts element can be obtained prior to settlement for security although for a strata its of less value and needed from settlement date usually (some states vary). The LL emement is a add on from the time you commence to list it for availability.

Have you tried to call EBM ?? They are well regarded and like TS have specialised polcies for investors (Product = Rentsure). EBM and TS are the most well regarded. The facts EBM require a lease makes sense. Why would they want you to pay for something that isnt a risk yet ?

 

Thanks both.

I definitely realised it's not as straightforward as I initially thought!
My IP is a freestanding house, so looking for building insurance (which my bank is also requesting for the certificate before they unconditionally approve my loan) + landlord cover (thinking just the basic contents cover for now).

I wanted to get them both at the same time as TS is offering a discount, but maybe I'll have to get the building one first given I want to make sure there's no delay from the bank to approve my loan. I did confirm on the phone with TS (not EBM yet) that they can't offer me the building insurance now since the settlement date (ie start of the policy) is more than 30 days in the future. The advice I got was to call back within 30 days of settlement.
Or maybe I can have the insurance to start earlier than the settlement date - though not sure how it works if I'm not officially the owner yet?

The other option is to go with Allianz but would prefer to at least hear some positive experiences from others before deciding.

 

I got building insurance up until settlement then when the tenants moved in, I moved to landlord insurance.

 

How odd- you're supposed to have Building Cover from the contract date so why would an insurer refuse to provide it. Where's the property, maybe one of the local agents on the Forum here can check with their insurance account managers for EBM or TS?

 

I’ve already signed the contract and it seems for NSW, I only need insurance starting on settlement date (which will be another 60+ days to go). Different states seem to have different rules on this when I did a quick google search.

Unless I should be getting insurance to start earlier?

 

Even though you may not need insurance - you can’t rely on the vendor having it. What if it burned down before settlement?

My lawyer in Vic advised me to get building insurance from the day the contract was signed.

 

Get the insurance to start earlier. Now you have a financial interest in the property, you should have it.

you don’t know if the vendor has a current policy or not, and if something were to happen it’s better to have too much insurance than none at all.

 

Pre-settlement inspection should find that the property is not in the same state as was described on the contract date and your solicitor will cancel settlement in that case.

 

This depends on your contract & also varies between states so important to be aware of your local and contracted risks and exposures.

 

But if you have insurance you can complete the purchase and either build a new house if it’s not repairable - or have it repaired.