14 May Common Challenges In Landlord Insurance Claims

Common Challenges In Landlord Insurance Claims

A common challenge that is faced in claims under a landlord insurance policy arises from the failure of the insured to maintain proper records.

Common situations we see are:

• The insured does not use a property manager. A landlord does not have to use a property manager, but one thing that a property manager does is keep records. If the insured does not use a property manager, the insured needs to keep records – quite often they do not do that.
• There was no written lease agreement with the tenant or, if there was, it expired some time ago. Most policies require that the rent default cover will only operate if the landlord has a written lease with the tenant.
• There is no program for carrying out regular inspections of the premises. In a recent case study, the insured property was not inspected by the landlord or an agent for three to four years. The insurer denies indemnity on the grounds that the loss is the result of gradual deterioration or wear and tear. Regular inspections of the building are an important source of evidence required to refute those allegations.

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