Renting out an apartment can help you earn rental income. But traditional home or strata insurance does not cover key landlord risks. Landlord insurance for apartment owners can help cover tenant damage, rent default, lost rental income, legal liability, insured events covered and landlord-owned contents.
Strata insurance usually covers the building and common areas. It does not usually cover tenant-related risks, landlord contents, rent default or public liability inside your apartment.
Home insurance is usually designed for owner-occupiers, not investment properties. Landlord insurance can help reduce your financial risks. Depending on the policy, it may cover malicious damage, accidental damage, broken glass, legal expenses, liability claims and loss of rental income.
Before choosing a cover, compare landlord insurance options. Read the product disclosure statement and check your strata insurance.
Do You Need Landlord Insurance For An Apartment?
You do not legally need landlord insurance for an apartment in Australia. But it can help protect your rental property from risks that strata insurance and home insurance may not cover.
For apartment owners, the main gaps are often tenant risks, rental income risks and legal liability, because landlord insurance is designed to cover landlords of an investment property, where strata and home insurance may leave gaps. A landlord insurance policy may help cover:
- Rent default: If a tenant stops paying rent, depending on the policy.
- Lost rental income: If the apartment becomes unfit to live in after an insured event.
- Malicious damage: If a tenant damages the property on purpose.
- Accidental damage: If tenant damage is included or added as optional cover.
- Legal liability: Liability cover if a tenant or visitor makes an injury claim linked to the property.
- Landlord contents: Landlord contents cover for items inside the apartment, such as carpets, blinds, curtains and landlord-owned appliances.
Landlord insurance can help mitigate the cost of sudden claims. It can also help protect your rental income from tenant-related issues.
What Strata Insurance and Buildings Cover Usually Protect
Strata insurance usually protects the building structure and common property in an apartment complex, and it is often arranged through the body corporate. However, it does not replace landlord insurance because it does not usually cover tenant-related risks inside your apartment.
Apartment landlords should check what their strata insurance includes before choosing a landlord insurance policy. Owners should also confirm whether any internal fittings are insured or whether they need extra cover fixtures not included by strata. This helps show the gaps between buildings cover and the risks linked to renting out the apartment.
| Cover Type | What It Usually Covers | What It Usually Does Not Cover |
| Strata Insurance | Buildings and Common property, shared walls, roofs, lifts, foyers, stairwells, hallways and shared facilities, as well as Public Liability | Rent default, tenant damage or landlord contents, |
| Landlord Insurance | Tenant damage, rent default, legal liability, landlord contents and loss of rent, depending on the policy | Wear and tear, poor maintenance, tenant belongings and excluded events |
What a Landlord Insurance Policy Can Cover
A landlord insurance policy can provide cover for apartment owners against rental risks that strata insurance and home insurance often exclude. Cover varies by insurance provider, so read the product disclosure statement before choosing a policy.
Depending on the policy, landlord insurance may cover:
- Property damage: Damage caused by extreme weather events, such as storms, fire, natural disasters or other covered events.
- Malicious damage: Damage caused on purpose by tenants.
- Accidental damage: Tenant damage, if included or added as optional cover.
- Broken glass: Damage to windows, doors or fixed glass, depending on the policy.
- Loss of rent: Lost rental income if the apartment becomes unfit to live in after an insured event.
- Rent default: Missed rental payments if a tenant stops paying rent according to the rental agreement, as included.
- Legal liability: Injury claims made by tenants or visitors.
- Legal expenses: Costs of defending yourself in the event of a claim brought against you.
Policies also cover landlords for tenant defaults, depending on the wording and conditions.
Some insurance policies include key cover as standard. Others offer it as optional cover for an additional premium.
What Landlord Insurance Does Not Cover
Landlord insurance does not cover every risk linked to an apartment rental. Most policies exclude:
- Wear and tear: Ageing, marks, fading or general use over time.
- Poor maintenance: Damage caused by neglect, missed repairs or unsafe conditions.
- Pre-existing issues: Problems that existed before the policy started.
- Tenant belongings: Furniture, electronics, clothing and other items owned by the tenant are not covered by landlord insurance, so tenants may need their own contents-only policy or contents insurance cover.
- Excluded events: Damage or loss that the policy does not list as covered.
Landlords must maintain the property and provide a safe home for tenants. Regular checks can help find leaks, mould, faults, damage or safety risks before they become larger claims, because an insurance company will usually not pay for wear and tear or poor upkeep.
Contents Insurance, Replacement Value and Landlord-Owned Items
Landlord contents insurance can help protect items you own inside the apartment. This kind of contents cover is useful if the property is partly furnished or includes landlord-owned fittings that strata insurance does not cover.
This cover may apply to carpets, blinds, curtains, light fittings, appliances, furniture and other landlord-owned items. It depends on the policy, and some of these items may be covered by landlord contents insurance where the policy includes landlord-owned furnishings and appliances. Tenant belongings are not covered.
Some policies can also cover accidental pet damage from tenants’ pets, such as stains or scratches, where permitted pets are allowed.
Replacement value matters because it affects how much your insurance provider may pay if covered items need repair or replacement after an insured event.
| Item Or Cover Type | Usually Covered By | Why It Matters For Apartment Landlords |
| Building Structure | Strata Insurance Or Building Insurance | Helps cover shared structural areas, depending on the strata scheme |
| Carpets And Blinds | Landlord Contents Insurance | These are often landlord-owned items inside the apartment |
| Appliances And Furniture | Landlord Contents Insurance | Useful if the apartment is partially furnished |
| Tenant Belongings | Tenant Contents Insurance | Landlord insurance does not cover a tenant’s personal items |
| Replacement Value | Depends On The Policy | Helps determine the payout if covered items need replacement |
How Landlord Insurance Cost Is Calculated
Landlord insurance cost depends on the apartment, location, claims history, sum insured, excess and selected cover options. For some owners, landlord building insurance can also affect the premium depending on the apartment and ownership structure.
Optional extras can also affect the premium. These may include rent default cover, accidental damage cover, flood cover, malicious damage cover and extended loss of rent protection. Premiums also vary by insurer and broader insurance Australia market conditions.
Landlord insurance premiums are generally tax-deductible when the apartment earns rental income. Landlords should seek tax advice for their own situation. They should also consider their financial situation before choosing cover levels or optional extras. They should also keep records of insurance costs.
| Example Cost Item | Amount | How It Affects The Landlord |
| Annual landlord insurance premium (illustrative, not a landlord insurance quote) | $950 | The yearly policy cost |
| Estimated tax deduction | $950 | Generally deductible when linked to rental income |
| Claim excess | $500 | Amount paid by the landlord for each claim |
| Example approved repair claim | $4,000 | Covered repair amount before excess |
| Example payout after excess | $3,500 | $4,000 claim minus $500 excess |
How To Compare Landlord Insurance For Apartment Owners
Apartment landlords should compare landlord insurance by more than price, and some also compare a new landlord insurance policy by cover quality, not just cost. A cheaper policy may have lower claim limits, higher excesses, more exclusions or fewer optional cover choices.
Check what your strata insurance covers first. Then compare rent default, loss of rent, malicious damage, accidental damage, legal liability, landlord contents, contents insurance cover for furnished or partly furnished apartments, broken glass and legal expenses.
Before choosing an insurance provider, read the product disclosure statement. Check the limits, exclusions and claim conditions. Readers should also compare whether policies include liability cover and lost rent benefits when the apartment is uninhabitable. Duo Insurance can help you compare options and find cover that suits your apartment rental.
Landlord Insurance FAQs
Is Landlord Insurance For Apartment Owners Legally Required?
No. Landlord insurance is not legally required in Australia. But it can help protect against tenant risks, property damage, legal liability and lost rental income.
Does Strata Insurance Cover Rent Default?
Usually no. Strata insurance is often arranged through the body corporate and generally covers the building and common property, not rent default, tenant damage, loss of rent or tenant disputes. Owners may also need landlord contents cover for fixtures, fittings, or furnishings inside the apartment that are not insured by strata.
Does Landlord Insurance Cover Malicious Damage?
Many policies cover malicious damage by tenants. Some include it as standard cover, while others add optional cover for an additional premium.
Does Landlord Insurance Cover Broken Glass?
Some policies cover broken glass caused by an insured event, attempted theft or tenant damage. Check the product disclosure statement for limits and exclusions.
Does Landlord Insurance Cover Tenant Belongings?
No. Landlord insurance does not cover tenant belongings. Tenants should consider a contents-only policy or contents insurance cover for their own items. It can also cover landlords for landlord-owned contents in a furnished apartment, but not the tenant’s personal belongings.
Key Takeaways
- Landlord insurance for apartment owners can help cover risks that strata insurance and home insurance may not include.
- Strata insurance usually covers the building structure and common areas, but it may not cover tenant damage, rent default or landlord contents.
- A landlord insurance policy may help cover loss of rent, malicious damage, accidental damage, legal liability, broken glass and legal expenses, depending on the policy.
- Landlord contents insurance can help protect landlord-owned items such as carpets, blinds, curtains, appliances and furniture inside the apartment.
- Tenant belongings are not covered by landlord insurance, so tenants may need their own contents insurance.
- Landlord insurance does not usually cover wear and tear, poor maintenance, pre-existing issues or excluded events.
- The cost of landlord insurance can depend on the apartment, location, claims history, sum insured, excess and optional extras.
- Apartment landlords should compare more than price by checking cover limits, exclusions, excesses, optional cover and the product disclosure statement.
Frequently Asked Questions (FAQs)
Is Landlord Insurance For Apartment Owners Legally Required?
No. Landlord insurance is not legally required in Australia. But it can help protect against tenant risks, property damage, legal liability and lost rental income.
Does Strata Insurance Cover Rent Default?
Usually no. Strata insurance is often arranged through the body corporate and generally covers the building and common property, not rent default, tenant damage, loss of rent or tenant disputes. Owners may also need landlord contents cover for fixtures, fittings, or furnishings inside the apartment that are not insured by strata.
Does Landlord Insurance Cover Malicious Damage?
Many policies cover malicious damage by tenants. Some include it as standard cover, while others add optional cover for an additional premium.
Does Landlord Insurance Cover Broken Glass?
Some policies cover broken glass caused by an insured event, attempted theft or tenant damage. Check the product disclosure statement for limits and exclusions.
Does Landlord Insurance Cover Tenant Belongings?
No. Landlord insurance does not cover tenant belongings. Tenants should consider a contents-only policy or contents insurance cover for their own items. It can also cover landlords for landlord-owned contents in a furnished apartment, but not the tenant’s personal belongings.
