Owning an investment property can be a financial dream – but it’s certainly not always easy.
Maintenance issues arise, tenants move out, the rent stops coming in… and things can unravel pretty quickly. By then, it’s usually too late to read the fine print.
That’s why in 2025, having the right landlord insurance isn’t just smart – it’s a non-negotiable, and can be the difference between a minor hiccup and a major financial hit.
But with so many insurers and policies out there, how do you know which to choose? Put simply, not all insurers are created equal – they generally fall into two categories: mainstream and specialist providers.
Mainstream
Mainstream landlord insurers tend to be big-name providers (think banks, supermarkets, even Australia Post) which typically ‘tack on’ landlord insurance to an existing product, service or policy you may already have, so that they appear cheaper. They usually offer a policy that looks like landlord insurance, but is likely a rebranded home policy with a few extras.
In other words, it may seem fine, until you actually need to use it – which is why in most cases we recommend against purchasing a policy with them.
Example mainstream providers
- Budget Direct
- NAB
- CommBank
- St George Bank
- Honey Landlord Insurance
Specialist
Specialist landlord insurance is a completely different story – it’s tailored specifically for the rental market. Specialist providers cover the common risks faced by landlords such as loss of rent, damage, legal expenses and so much more.
Having a specialist insurance company that truly understands the ins and outs of renting means you’re covered for the unique risks, too – making it far more likely to have claims paid when it matters the most.
Example specialist insurers
A case study
Recently, Prudential Real Estate managed two unrelated insurance claims for two different investment properties; one specialist provided, and one mainstream.
Specialist: A burst pipe flooded the top floor of a property, and emergency services were called to drain and dry the area. The claim was submitted under the contents cover of the landlord insurance policy, was processed, and approved within 7 working days.
Mainstream: A tenant consistently failed to pay rent and was falling into arrears, later having their lease terminated via tribunal. The mainstream insurer only covered a small portion of the arrears, and as a result of policy terms and conditions, was able to take half of the excess. This took 3 weeks from the time the claim was submitted and resulted in a major expense for the landlord. On the other hand, a specialist insurer would have covered almost all of the landlord’s losses.
The takeaway
If you’re going to protect your investment, make sure you use the right tool for the job. In almost all cases, specialist providers offer faster processing, broader cover and fairer excesses, which many mainstream providers fall short on.
Always check the fine print, speak to your property manager prior to taking out a policy, and choose one that’s built for landlords.
For more information on landlord insurance, see our previous article.
Prudential Real Estate Macquarie Fields | (02) 9605 5333 | macquariefields@prudential.com.au
Prudential Real Estate Narellan | (02) 4624 4400 | narellan@prudential.com.au
