Brand EditorialEPM: Best Practice & Legislation

Protecting properties this festive season

The festive season is all about goodwill, joyous get-togethers, long-anticipated holidays and generally getting into the Christmas spirit. But it can also be a risky time of year for investment properties, says EBM RentCover Managing Director Sharon Fox-Slater.

For many people, the image of the festive season is one of joy. But sadly, once the last of the Pavlova has been eaten, many landlords and agents will face the harsh reality of what the season can bring for investment properties. 

Now, I don’t want to be a party-pooper, but things happen and you and your landlords and tenants need to be prepared. As landlord insurance providers, we have seen the fallout from a less-than-fabulous festive season and don’t want you to experience it first-hand.

Lights, camera… fire
Nothing says it’s Christmas quite like the twinkle of lights. And while no-one wants to be the Grinch who stole the Christmas spirit, the reality is that candles, fairy lights, flammable decorations and overloaded electrical extensions can all increase the risk of fire.

So as the festive season approaches, take the time to remind tenants about some basic seasonal safety tips like not overloading power boards, turning off fairy lights when they leave the property, not hanging lights on or near flammable materials, never leaving a burning candle unattended and making sure decorations don’t block smoke detectors or security alarm sensors. You could save them, your landlord client and yourself a lot of heartache, loss… and even lives.

A financial hangover
Buying presents, blow-out dinners, long lunches, catching up for a festive tipple, putting on a big feast, being generous with loved ones, taking a break, going on holiday – the costs can very quickly add up over the festive season…and leave a financial hangover into the new year.

For many people, Christmas is an expensive time, often compounded by the costs of heading back to work and school in January, which can leave money tight… and lead to tenants not paying their rent.

Insurance claims for rent default traditionally spike in the first three months of the year. Help your landlords avoid the new year rental loss dramas by being proactive with rent collection and keeping on top of rent arrears over the season.

Make like one of the three wise (wo)men: check that your landlord client has insurance that actually covers loss of rent. 

On the first day of Christmas my true love gave to me… and the next day it was stolen
It may well be a time for goodwill towards all, but it’s also a time when thieves are out in force. Between people going on holiday (leaving properties vacant and vulnerable), leaving doors and windows open (there may be snow dome decorations out but it’s scorching in Aus) and getting lots of new goodies (the evidence of which is frequently on display) – it’s a very joyous time for the light-fingered.

A few security tips for tenants and a request for them to let you know if they are going away so you can keep an eye on the property wouldn’t go astray. And reminding them they need their own renters’ contents insurance because their landlord’s policy doesn’t cover their possessions, could also save your tenants from financial misery.

Party season = damage
Whether swaying to Wham’s Last Christmas, laying on a slap-up feast with all the trimmings, having small kids rampage through gift boxes or hosting a drinks party, if tenants are entertaining over the festive season, there’s an increased risk of accidental damage.

While tenants are responsible for any damage that they, their pets or their guests cause, it pays to make sure your landlord clients have insurance that includes accidental damage, just in case. And check it covers malicious damage too, as parties can get out of hand (especially at holiday lets and properties leased short-term). And, most importantly, make sure there is liability cover in case someone is injured (or worse) on the property and the landlord is held responsible for the loss.

Tenants need liability cover too if injury or loss is their fault, so get them to check their renters’ insurance provides legal liability cover. 

It can all become too much
For some people, the festive season is less about joy and more about stress. The financial imposts of Christmas can be crippling (it can be prime time for job lay-offs too) and relationships can suffer. Sadly, it’s a time when pent-up stress and anger can erupt and the investment property can bear the brunt of a relationship turning sour.

So it’s important to check your landlords have insurance that covers malicious damage, as these costs can be hard to recoup from tenants, especially if they are already facing challenges. 

There was no room at the inn… so the tenants listed the property on Airbnb
A lot of people have jumped aboard the Airbnb juggernaut. And if tenants are looking at earning a bit of cash over the festive season by listing their rental while they’re away, your landlord client could have a problem.

If the tenants have packed up and gone on vay-cay and left the home in the hands of a guest, then they have effectively given the guest exclusive possession.

This translates as having sublet the property and is excluded from most landlord insurance policies. So if something goes wrong, your landlord client may not be covered. And if you knew what the tenants were doing (or ought to have known) then you will probably face some tough questions from your landlord… and their insurer! Best to be vigilant about letting tenants know this is a no-no and keep an eye peeled on the platforms for properties on your rent-roll so you can nip any issues in the bud.

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