Major insurers in Australia have suspended indefinitely the sales of landlord insurance products, citing uncertainties from the coronavirus outbreak.
Landlord
policies usually cover rent defaults by tenants, and with the Morrison
Government announcing last night the states and territories will put a
six-month moratorium on evictions, insurers say they have to adjust their
policies accordingly.
Worries
that renters might be forced to default are growing as the coronavirus outbreak
has led to huge layoffs, especially in the hospitality and retail sectors.
"Allianz
has temporarily ceased selling landlord insurance while we put in place a
change to remove the optional cover for loss of rent,” a spokesman told
insuranceNEWS.com.au today. "This
change is being made in light of the move by governments to put in place a
six-month moratorium on the eviction of tenants.
"Landlord
policies can include a requirement for a landlord to seek to evict a tenant in
order to make a claim for loss of rent, which will not be possible during the
moratorium.
"As
a result, Allianz does not believe loss of rent cover provides sufficient
customer value at this time to warrant its continued sale.”
insuranceNEWS.com.au understands the eviction moratorium
means landlords planning to make a claim are only required to provide proof of
financial loss instead of a tenant eviction notice.
Suncorp
and IAG also confirmed their brands have stopped selling landlord insurance
until further notice.
"Insurance
is intended to provide cover for unforeseen events,” Suncorp EGM Products and
Portfolio Darren O’Connell told insuranceNEWS.com.au.
"Given the uncertainty around the evolving COVID-19 situation, we were left
with no option but to temporarily stop selling new landlord insurance. Our
focus is on supporting our existing customers through this difficult time.”
An
IAG spokesman says the business stopped selling landlord products across its
NRMA, SGIP and SGIC brands last Thursday until further notice.
"This
decision does not impact customers with existing landlord policies who can
claim for benefits such as loss of rental income if a tenant defaults on
payment,” the spokesman told insuranceNEWS.com.au.
See our related
article "Emergency Repairs-Tips for Landlords”: https://www.realrenta.com.au/blog/post/123
Marlene Liontis & Jason Gwerder
Friday, 3 April 2020
