Corona Virus and Property 1: Rental, tenants and landlords insurance
Conversation with an insurance broker today:
Summary of the conversation relating to Corona Virus, property rental, tenants, insurance and landlords. The Government, it would seem, is yet to add significant clarity as to what landlords for residential property need to consider. One thing is for sure, many insurance companies are not offering rent default insurance for new policies while the pandemic is running rampant. Landlords should take care if seeking insurance through a new provider. Even renewing an existing policy will mean with some insurers that the previous level of cover is significantly reduced for rent default.
If landlords reduce the rent they charge a tenant, an insurance company will not bridge the gap. If a landlord is earning $800 a week for example, and the landlord then reduces this to $600 to help the tenant, but then the tenants is still not able to sustain that after a short time, and stops paying, the insurer will likely only cover equivalent of up to $600 (depending on the policy, it could be less), certainly not $800.
Landlords should not have to reduce rent on residential property if the rent is below $500 in my opinion, given the Government will provide up to $500 rent assist money for people who meet the required criteria related to Corona Virus.
There are some cretins out there, (dodgy, greedy low class tenants) that will stop paying rent, even though they are unaffected by Corona Virus, because they stupidly misunderstand the Government policy and think they can stop paying just because because they fell like it, and not be kicked out. Obviously this is incorrect. If a tenant is not adversely affected by Covid-19, and just decide to wake up one morning and stop paying, they can and will be kicked out, and so they should!!
Tenants earning a good income with job security that can still afford the rent should not leverage off the misfortune of others.