The quick answer
Yes—unless you’re happy to pull out the chequebook when things go pear-shaped. Allianz’s own claims data show that while most landlord claims in NSW are for less than $2,000, the next-largest chunks sit in the $2,000–$5,000 and $5,000–$10,000 bands.
In other words, even “typical” mishaps can wipe out a year’s rental profit. And when Mother Nature strikes, the numbers jump fast: after the 2023 Northern Rivers floods the average home-insurance payout topped $73 k.
Landlord insurance is designed for exactly these wallet-crushing moments—because small problems add up quickly, and big ones can be catastrophic.
What landlord policies typically cover
Loss of rent – tenant default, tribunal orders, denial of access.
Property damage – malicious or accidental; think kicked-in doors or kitchen fires.
Liability – a tradie trips on broken tiles and sues.
Weather events – storms, floods, bushfire (varying excesses apply).
Heads-up: Standard building insurance often excludes tenant-related loss and short-stay Airbnb risk.
NSW quirks you can’t ignore
Strata schemes: If you own a unit, the body-corp policy won’t cover your internal fittings or rent loss.
Short-term rental code (2021): Some insurers void cover for hosts who exceed 180 nights in Greater Sydney without the right add-on.
Flood definitions: Insurers follow the ICA’s wording; check if your postcode is flood-prone on the SES map before assuming you’re covered.
Real-world claim scenarios (because numbers alone don’t hit home)
The tenant who loved candles
A Newcastle landlord thought her unit was “bullet-proof” until a scented-candle session went rogue. Result: smoke damage throughout, a scorched benchtop, and a $7,800 repair bill. Her landlord policy covered the cleanup and six weeks’ lost rent while tradies repainted. Out-of-pocket cost? The $400 excess—and a lifelong distrust of vanilla bean soy.
Storm season surprise
January’s East-Coast Low dumped 200 mm in 24 hours on Shellharbour. One investor discovered that standard building cover stopped at the balcony door; internal water ingress from blocked gutters wasn’t included. A comprehensive landlord policy picked up the $5,200 ceiling-repair tab and a fortnight’s rent while the place dried out. Moral? The devil’s in the product disclosure statement—always skim the “exclusions” with a highlighter.
Seven-minute checklist for comparing policies
Sum insured vs replacement cost – Future timber prices won’t care you under-insured.
Loss-of-rent trigger – Some insurers pay only after a tribunal order; others kick in at 14 days in arrears.
Fixed vs variable excesses – A higher excess can slash premiums but turns $1 k mishaps into DIY fixes.
Pet clause – If Fido is welcome, ensure “domestic animal damage” isn’t capped at a token $500.
Short-stay cover – Planning three Airbnb stints a year? Tick the “holiday letting” box now, not after a claim.
Legal liability limit – Aim for at least $20 million; slip-and-fall payouts add up faster than Sydney tolls.
Claims process rating – Read customer reviews; a cheap premium is worthless if the hotline is M.I.A. during a cyclone.
Spend those seven minutes and you’ll avoid the nastier surprises—like discovering your policy covers meteor strikes but not broken glass.
Choosing a policy: Five questions to ask
| Question | Why it matters |
| Maximum rent-default period? | Some stop at 8 weeks; others pay up to 20. |
| Malicious vs accidental damage limits? | Cheap policies cap claims at $5 k. |
| Are pets covered? | Pet damage can top $2 k—worth the small premium uplift. |
| Short stay allowed? | Essential if you plan occasional Airbnb. |
| Excess structure? | Higher excess lowers premiums but can wipe out small claims. |
Ball-park costs in 2025
Finder’s latest comparison shows NSW landlord premiums ranging $350–$950 p.a. for a $750 k house, with coastal suburbs attracting cyclone-and-flood loadings of up to 25%.
Claim-avoidance hacks (because prevention beats paperwork)
Quarterly inspections with photo reports.
Clear, written pet agreements—include flea-treatment clauses.
Smoke-alarm compliance—NSW fines land squarely on owners.
Realistic rent—overpricing encourages arrears.
So, do you really need it?
If you’re cash-heavy and risk-tolerant, maybe not. For most everyday landlords, one bad tenant or freak storm can wipe out five years of net yield. At roughly the cost of two-and-a-half takeaway coffees a week, insurance is peace of mind served cheap.
Helpful links
Visit the links below for more info on leasing in NSW:
| Step-by-step guide
| FAQs
| Why choose Dimosons
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