This article was reviewed and updated on 04/02/2020
While no-one likes the idea of having to deal with the death of a tenant, it is something many landlords and property managers will encounter. Do you know what to do?
It’s the last thing any landlord or property manager wants to think about, but the sad reality is that tenants can and do pass away. And you need to know what to do.
Handling the death of a tenant at a rental is a difficult and stressful situation. There are legal obligations to handle, distressed family and loved ones of the deceased to liaise with, and financial ramifications to contend with.
At EBM RentCover a commitment to delivering care and consideration drives everything we do and we are here to be the voice of knowledge in times of uncertainty. While we hope you never have to deal with the passing of a tenant, we trust these tips will be useful if you do:
- If you’re the one to discover the body, contact the police immediately – they will handle the removal of the body and contact the next-of-kin. Once the police return to the premises to you or if you are notified of a tenant’s passing, make sure to properly secure the property by locking doors and windows. If the tenant lived at the property alone ensure any pets are taken care of and make sure no-one enters the property or removes anything. You should only provide a key/access to the deceased’s executor/next-of-kin.
- Notify the insurer and confirm the cover available. Unlike EBM RentCover, some insurance providers do not cover damage costs and some do not cover loss of rent, so it is important to check the policy inclusions and exclusions. The insurance provider will guide you through the claims process. In preparation for any claim on the landlord insurance policy, you should:
- Document all correspondence with the deceased’s executor;
- Keep written evidence of the actions taken and their dates, e.g. listing the property for rent;
- Keep all receipts from work and services undertaken at the property; and
- Contact the insurer regarding supporting documentation – usually a death certificate will be required but in some instances insurance companies will accept differing forms of proof.
- Follow the state and local laws applicable for appropriately handling tenant deaths at rentals, such as serving notices, terminating leases, returning bonds, disposing of tenant possessions and disclosures. It is important you follow the rules and understand your obligations. For example, just because a sole tenant has passed away, this does not mean the lease automatically terminates, nor does the landlord have the right to immediately take possession of the property or remove the tenant’s belongings. You need to follow your state’s procedure for ending the lease and returning the bond. If a co-tenant dies (joint tenant), this does not end the lease either and the remaining tenant(s) can continue with the tenancy agreement or you can negotiate ending the lease if they do not wish to stay on. The deceased’s property transfers to their estate/next-of-kin, so you must not remove their belongings from the rental as this is the executor’s responsibility. If there is no next-of-kin, you need to follow your state’s procedures for dealing with abandoned tenant property.
- When appropriate, open lines of communication with the deceased tenant’s executor or next-of-kin so you can discuss transitioning the rental property back to the owner. Remember this is a difficult time for family and loved ones of the deceased, so offer your condolences, always be tactful and kind, and be patient when corresponding with the executor or next-of-kin.
- The next-of-kin/executor is responsible for the deceased’s rent and providing vacant possession. The landlord is entitled to rent (paid from the bond, deceased estate or a co-tenant) until the lease ends. The executor is responsible for dealing with the tenant’s possessions and arranging cleaning of the property (including any specialist cleaning required). Note: the bond can be used to pay for repairs and cleaning to return the property to its original condition but the usual bond rules apply e.g. normal wear and tear is the responsibility of the landlord.
- Once you have vacant possession, advertise and re-let the property. It’s important to keep written evidence of the advertising activity including dates listed, costs, and commencement date of the new agreement, as this will be needed when it comes time to submit an insurance claim.
- Submit a claim with the landlord insurance provider. When a tenant passes at the rental, the landlord may face costs that cannot be recouped from the bond or estate. Depending on the cover provided, the landlord may be able to claim for damage repairs/cleaning costs and for loss of rent from their insurer.
At EBM RentCover we work with clients to minimise the emotional and financial stress associated with making an insurance claim. Our Expert Care team is on hand to provide guidance during this difficult time, please contact us... 1800 661 662.
*While we have taken care to ensure the information above is true and correct at the time of publication, changes in circumstances and legislation after the displayed date may impact the accuracy of this article. If you need us we are there, contact 1800 961 017 if you have any questions.
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