If your tenant stops paying rent, will your landlord policy pay you anything?

Tenant damage is where the fine print actually matters. Accidental damage, a hole punched through plasterboard by moving furniture, a burst pipe from a tenant's washing machine, is generally treated like any other insured event. Malicious damage, deliberate destruction by an angry tenant, is assessed far more narrowly on some policies in this market, and insurers genuinely dig into which specific items meet that test. A real 2021 determination published by the Australian Financial Complaints Authority (AFCA) against a landlord insurance claim shows exactly how that plays out: of a long list of damaged items a landlord claimed as malicious, the insurer and AFCA found only some, a cracked toilet door and wall holes, actually met the "malicious acts" test; missing door knobs and fittings were covered under theft instead, cracked windows and a missing shower screen under accidental glass breakage, and items like carpet damage, blinds and general wear and tear were not covered at all.

On the wording we place most, that narrow "was this malicious" test isn't one the wording applies to damage to your own property. Cover attaches to accidental damage or loss, and only specific exclusions carve items back out: superficial scratching and scuffing, a tenant's general neglect or poor housekeeping, and theft, which stays a separate question, covered below. That's a genuinely different structure to the fact pattern the published case above had to work through, where a claim had to clear a defined "malicious acts" test item by item before it was paid.

What that means in plain terms: you don't have to prove malice for the policy to respond. What matters is that the damage wasn't something you caused or intended yourself. There is a limit, though. The wording never names deliberate tenant damage as covered. It also defines malicious damage as something different from accidental damage. So how a tenant who wrecks a room is treated is a claims question the wording itself doesn't settle. We've seen that distinction decide claims in our clients' favour. And if the property is vandalised or maliciously damaged, the wording does ask you to tell the police.

Theft is the one thing that still needs asking for on the wording we place most. If a tenant walks off with your fixtures or fittings, three of the five landlord wordings we compared pay only under their own optional section; the other two include it as standard. Where it is optional it's worth having, because on the wording we place most it scales with what your buildings and contents are actually insured for rather than a flat dollar cap.

Loss of rent works only when the property becomes genuinely untenantable because of an insured event, fire, storm, that kind of thing. It is not rent-default cover, see the next section. On the wording we place most, it runs for up to 24 months, well beyond the 12 months the direct products we checked cap it at. And landlord liability is the section that responds if a tenant, or a visitor to the property, is hurt and comes after you as the owner. On the wording we place most, that liability limit is whatever figure is shown on your schedule, not a fixed amount that comes bundled with the policy, so it's worth checking it's actually enough rather than assuming a number that sounds big enough is already there.

Queensland law gives you a process, not a rescue. Once rent is seven days overdue, you (or your property manager) can issue a formal notice to remedy the breach, giving the tenant a further period to pay. If it still isn't paid, you can issue a notice to leave, with a minimum further notice period before they have to go (Residential Tenancies Authority, Queensland). That process takes real weeks, during which you are carrying the mortgage on a property that has stopped producing income. Rent-default cover is what stands behind you while that plays out.

It pays to understand how that cover actually works, so you use it properly rather than expecting the wrong thing from it. On the wordings we place it's capped, on most it won't pay on rent that was already in arrears when the policy started (cover switches on once the arrears are cleared and the tenant has then paid on time for several consecutive weeks), and it pays once you've run the legal process above, notice to remedy through to eviction, rather than from the day a tenant first falls behind; the claim stops the moment the property is re-let. It is not an instant safety net, but it is real money at the end of a bad tenancy, on a risk every landlord carries.

On the wordings we place it also brings a benefit worth having in its own right: between $3,000 and $6,000, depending on the wording, toward the legal costs of evicting a tenant, or recovering money or stolen property from them. Between the rent it recovers and those legal costs, it is inexpensive cover against one of the most common ways a residential tenancy goes wrong, which is why we recommend it as standard rather than an optional extra to weigh up.

Where a broker actually earns their keep on a landlord policy isn't the day you buy it. It's the day a tenant has damaged a list of things and the insurer starts counting excesses.

Here's the part most owners never see coming. When a tenant damages several things, the insurer looks at whether it all happened in one event or built up over a period of neglect, and it can try to apply a separate excess to every separate piece of damage. Left alone, that turns one bad tenancy into a stack of excesses that quietly swallows most of your payout. We argue to bring that down on your behalf, to something commercial for the situation, so the cover you paid for has the best chance of actually reaching you.

It's the same reason we read the actual wording, not just the product name, before you sign anything: so we can see when the tenant-damage section on the policy you're being sold is written narrower than the one next to it, and tell you plainly which optional extras are worth the premium and which aren't, even though it costs us nothing to simply sell you all of them.

Two things we check, from the five residential landlord wordings we compared in September 2026. The first is tenant damage. On three of them, malicious damage by a tenant is written into the standard cover. On another, deliberate damage by a tenant is capped at $1,000 per event and per period, and any unused bond counts as an extra excess, so deliberate damage above that $1,000 can be left with you. We check which of those you're on before a bad tenancy tests it.

The second is the rebuild. On one wording, the house is rebuilt new for old only if your schedule shows the words "including replacement benefit"; without them, the claim is settled on indemnity, not new for old. Three of the others state an as-new rebuild in the wording itself. We read the schedule for those words before we place the policy, not after a fire.

This page is for anyone renting out a residential property in Queensland, whether that's a freestanding house or a unit in a residential strata scheme. Most of the residential landlords we look after own a single-title house rather than a strata unit, but the distinctions below matter either way.

If your rental is a strata unit, the body corporate's own insurance covers the common property, the lifts, the driveway and the shared roof, and in most schemes the building structure as well, though not in every one: where a scheme's lots sit in a standard format plan and the buildings are detached, the body corporate may have no compulsory building cover at all, so it is worth knowing which plan your scheme is on. What it does not normally cover is your fixtures inside the lot or your liability as the owner of that specific lot. Some wordings do include a lot-owner fixtures extension, but on some of the ones we see it only switches on once the building's own sum insured has run out. Its cover for a lot owner's lost rent is capped too, so rent above that cap is yours to insure. You still need your own landlord policy on top of what the body corporate already carries; the two aren't a substitute for each other.

If you're insuring premises you lease to a business rather than a residential tenant, this isn't the right page. Go to Commercial Landlords Insurance, where the risks (and the tenant's obligations under a commercial lease) are genuinely different.

If the unit you rent out sits above a shop or an office, the building itself is a mixed-use risk, and who insures it depends on how the building is owned: see mixed-use building insurance.

1. Assuming a tenant who stops paying rent is an insurance claim. It generally isn't, on a standard landlord policy (see the risk section above).
2. Assuming every dollar of tenant damage will be treated as "malicious." Insurers assess that word narrowly, and a real published dispute shows exactly how a long list of damage got split into what was covered and what wasn't.
3. Not telling your insurer when the property sits vacant between tenants, or when you switch it over to short-term or Airbnb-style letting. On the wording we place most, cover lapses if nobody has lived at the property for a continuous 90 days, the same threshold CIB sees on the commercial side, though holiday letting is treated as its own category rather than simply "vacant." Going quiet about either change is the kind of thing that surfaces at claim time, not before.
4. Letting Queensland's smoke alarm law slide. Since 1 January 2022, every Queensland rental property has needed interconnected, photoelectric smoke alarms in every bedroom, in hallways connecting bedrooms, and on every level (Queensland Fire and Emergency Services; Residential Tenancies Authority, Queensland). It's a tenancy-law compliance obligation, not an insurance clause, but a fire that starts where an alarm should have been interconnected and wasn't is exactly the kind of thing that turns up in both a liability claim and a coroner's report.