Setting the right insurance on your property
By Sandy Deo
REMAX Landmark
INSURANCE AFFORDABILITY AND AVAILABILITY ARE GROWING CONCERNS FOR BOTH OWNER OCCUPIERS AND LANDLORDS. WITH SUCH A SIGNIFICANT FINANCIAL INVESTMENT IN THE PURCHASE OF PROPERTY, THE NEED TO PROTECT YOUR ASSET AGAINST POTENTIAL DAMAGES IS CRUCIAL FOR LONG-TERM SECURITY.
Property owners understand the importance of ensuring they have the right insurance in place. It protects our greatest assets. However, property insurance is not a “set and forget” exercise and if you are not actively reviewing your policy, you could be hit with a significant increase in costs, or worse, find your property to be underinsured.
Insurance affordability and availability are growing concerns for both owner occupiers and landlords. With such a significant financial investment in the purchase of property, the need to protect your asset against potential damages is crucial for long-term security.
The Australian Prudential Regulation Authority (APRA) estimates around one in seven Australian homes are currently uninsured. The regulator recently undertaking an Insurance Climate Vulnerability Assessment*, exploring how a changing climate could affect home insurance affordability and the insurance protection gap (the extent to which losses impacting home are not covered by insurance) in decades ahead.
Like any investment strategy, understanding risk is a significant part of the overall picture and should be well considered. Ensuring the right protection is in place for your rental property should regularly be reviewed as part of your portfolio.
Factors such as inflation, natural disaster and higher claim costs are contributing to rising premiums across the board. It’s important you are aware and have clear understanding of exactly what is – and just as importantly, what isn’t – covered in your policy, should the need to utilise it arise.
If you haven’t reviewed your investment property’s insurance policy recently, now is a great time to do so. Make sure your cover is up to date and aligned with your needs. While premiums are rising, there is still competition in the market, so it may be worth shopping around to ensure you’re getting the right level of cover for your investment.
*APRA stress test shows how the widening home insurance protection gap may impact Australia’s financial system resilience | APRA
Credit: REMAX Australia
