Am I covered for loss of rent?
Any rental property under our landlord insurance cover automatically includes loss of rent protection. This can also be included in our holiday home cover if you also rent your bach to guests.
There are two different scenarios where this cover applies.
a) Damage to the property
Loss of rent applies when something causes damage that means the house can no longer be lived in.
For example a flood soaks the carpets and your tenants need to move out. The tenants will not pay you rent while they’ve moved out and the repairs are done. This is where your loss of rent cover comes in to make up for the temporary shortfall in rent.
How much cover do I get?
$20,000 loss of rent comes as standard. There are options to increase this to $40,000 or $80,000 if you want more cover.
Loss of rent payments end once repairs are done and the property can be rented again. The max payout will be the cover limit you choose, or 12 months of rent.
b) Tenant is evicted, or abandons your property
We’ll also cover rent in some scenarios where there hasn’t been physical damage to the house. Landlord’s Protection in our landlord insurance cover will help cover the shortfall in rent when your tenant is evicted for not paying rent, or if they leave and stop paying rent.
6 weeks loss of rent – tenant eviction for non-payment
Tenants can be evicted through the Tenancy Tribunal when they’re over 21 days in rent arrears. Loss of rents are paid following the eviction, or until you find a new tenant. Overdue rents will not be covered, only the period following the eviction until you’re receiving rents again.
6 weeks loss of rent – tenant vacating without notice
Landlords can have unexpected shortfalls when tenants decide to leave their property and stop paying rent. If this happens without the tenants giving you the required notice we will pay the lost rents for up to six weeks, or until you find a new tenant.
To have this cover, make sure you’re meeting our landlord obligations.
Holiday homes rentals (e.g. AirBnb, BookaBach)
Under our Holiday Home cover there’s also loss of rent protection if you rent to paying guests.
12 months rent or up to the limit you select
You automatically have $20,000 of cover, with options to increase.
The weekly rents you receive from short term guests isn’t usually the same and can vary each week. We’ll make a calculation to estimate the lost rent based on expected bookings, and future bookings you have to cancel. If this doesn’t give us a clear estimate, we might also use rent income from previous periods or occupancy rates in the region.
Tenant eviction or vacation cover doesn’t apply to short term accommodation as guests do not have a formal tenancy agreement.