RentCover in tragic circumstances

Death and taxes are among life’s certainties but – while landlords are generally across the tax side of their investments – few consider the impact death of a tenant can have.
 
RentCover General Manager, Sharon Fox-Slater, said the death of a tenant could cost the property owner tens of thousands of dollars.
 
“It happens more often than you think. In these situations it is important to act with compassion and sensitivity while minimising the financial impact,” she said.
 
“The costs vary. There can be direct costs, in terms of lost rent and clean-ups, and indirect costs if a property is slower to re-lease because of the associated stigma.”
 
“That is why we have designed RentCover to include up to 52 weeks worth of lost rent. Once the property is ready to be rented again, we cover up to six weeks of vacancy until a new tenant can be found,” she said.
 
Recent successful claims include:
  • $50,000 to repair damage to a property in Melbourne where a tenant murdered his wife then committed suicide – and a further payment of almost $22,000 to cover lost rent over a 10-month period.
  • $17,000 in lost rent over 11-months to the owners of a Perth rental property where the property manager had difficulty tracking down the next of kin.
  • $11,000 in lost rent after a Melbourne tenant with no known next of kin committed suicide – the State Trustee did not allow access until the person’s possessions were auctioned and the funeral held.
“If a tenant lives alone, the landlord or property manager is sometimes the one who discovers the body when investigating why rent is not being paid,” Sharon said.
 
“Dealing with a grieving family can make negotiations difficult around issues like removing possessions. However, many property investors aren’t in a position where they can afford to lose rent for very long.”
 
Tips: what to do if a tenant dies
  • Be tactful, sensitive and compassionate in all dealings with the tenant’s family and friends.
  • Contact the next of kin and pay your respects.
  • Ask the next of kin who they would like you to deal with regarding the property.
  • Contact your insurer to ask about your cover and what paperwork you need to make a claim.
  • If police are involved, liaise with the officer in charge of the investigation about when access will be available.
  • Organise a meeting with the person nominated by the next of kin about plans for vacating the property. Approach the conversation tactfully.
  • Offer the person contacts for firms who might be able to help pack, sort and store possessions until the family is ready to deal with them.
  • Be sensitive about the timing of any open for inspections or other contact – being mindful of events such as the funeral.
  • When the property is vacated, clean it, using specialist assistance if necessary, and re-advertise it for lease.
  • Keep all receipts and records to assist in your landlord insurance claim.