Guide and Tips on Landlord Building Insurance

Last Updated: 15th April 2025

Your owners corporation fees include insurance, so that covers you — right? Wrong. Many NSW landlords assume strata insurance offers complete protection, but it doesn’t. That’s where dedicated landlord insurance becomes essential.

In this landlord insurance guide, we’ll walk you through common misconceptions, the key differences between strata and landlord insurance, and practical ways to protect your investment with smart, strategic cover. Whether you own an apartment, townhouse, or strata-titled unit, these landlord insurance tips will help you avoid costly mistakes and stay one step ahead.

Common Misconceptions About Landlord Insurance

One of the most frequent misunderstandings among NSW landlords is assuming that strata insurance covers all property-related risks. Unfortunately, this isn’t the case.

Here are some common misconceptions:

• “Strata insurance covers everything.” It doesn’t. Strata insurance typically only covers the building’s common areas and shared infrastructure — not the specific risks tied to leasing out your individual lot.
• “I don’t need contents cover — I’m not living there.” Landlords often forget that their property still includes fixtures, fittings, and furnishings they own — and they’re responsible for damage to those items.
• “Short-term rentals are automatically covered.” If you’re using or considering platforms like Airbnb, you’ll likely need additional cover.
• “Legal liability is handled by strata.” Not always. If a tenant or visitor is injured within your apartment, you could be personally liable.

A dedicated landlord building insurance policy is designed to fill these coverage gaps.

Strata Insurance vs. Landlord Insurance

To clarify the confusion, here’s a breakdown of how strata insurance and landlord insurance differ:

 
If you’re unsure what’s included in your current building cover, check out our detailed guide on strata building insurance.

5 Essential Tips on Landlord Building Insurance

1. Understand Your Risks

Becoming a landlord is a major milestone — but it comes with its share of responsibilities and risks. Here’s what your landlord insurance policy should help protect you from:

• Accidental damage to items like carpets, blinds, and light fittings
• Malicious damage caused by tenants or break-ins
• Natural events such as fires, storms, and flooding
• Loss of rental income while repairs are underway
• Legal liability if someone is injured in your apartment

An effective landlord building insurance policy is about more than just damage — it’s about safeguarding your investment and income stream.

2. There Are Savings in Strata

Many policies are designed with standalone houses in mind, which can lead to landlords unknowingly paying for cover they don’t need.

If your policy includes phrases like “building and landlord insurance” for a strata property, it may be overlapping with your strata insurance — meaning you’re doubling up and wasting money.

Instead, look for landlord insurance specifically tailored for strata properties. The best policies are designed to begin where strata cover ends, offering cost-effective protection for the risks that are uniquely yours as a landlord.

3. Airbnb and Short-Term Rental Cover

With short-term rentals on the rise, it’s more important than ever to confirm that your policy covers platforms like Airbnb or Stayz. Not all do.

Even if you’re not currently renting short-term, a flexible policy that includes this option gives you future-proofing. Market conditions change — your landlord insurance guide should factor in adaptability. Make sure your provider includes or offers optional cover for short-stay arrangements.

4. Consider NSW-Specific Laws

NSW tenancy laws tend to favour tenants, and navigating them can be complex. While legislation is designed to ensure fair treatment, landlords still need to protect their financial interests — especially when disputes arise or tenants default on payments.

A well-structured landlord insurance policy helps you operate confidently within the legal framework, offering coverage for:

• Tribunal-related legal costs
• Tenant rent default
• Damage from unauthorised occupants

In a legal landscape where risk management matters more than ever, landlord building insurance becomes a key part of protecting your property and peace of mind.

5. Focus on Your Goals — Not Just the Policy

Let’s face it — you didn’t become a landlord for the admin. You did it to grow wealth, secure your future, or generate passive income. But every investment comes with risk.

Think of insurance as a way to protect your returns, not just your property. Whether it’s safeguarding rent, covering repairs, or shielding you from liability, a tailored landlord insurance guide can help reduce stress and prevent financial setbacks.

And when you work with a strata-savvy insurer or adviser, you gain access to support that’s in step with the unique needs of strata landlords.

Common Mistakes Landlords Make With Insurance

Many insurance issues arise not from lack of coverage, but from wrong assumptions or poor policy selection. Here are some of the most common mistakes NSW landlords make:

• Assuming strata insurance is enough
• Underinsuring fixtures or contents you’re responsible for
• Not disclosing short-term rental use
• Failing to update the policy when renovations or furnishings change
• Choosing price over value — not all policies are equal

The right building and landlord insurance policy fills in the gaps, but only if you select the right one. Avoid cheap, off-the-shelf options that don’t align with strata ownership.

Need help navigating what’s included in your strata management plan? Netstrata’s team can assist you in understanding where strata cover ends — and where your own responsibilities begin.

Conclusion

Landlord insurance isn’t just a box to tick — it’s a critical layer of protection that helps safeguard your property, rental income, and legal standing. And for strata property owners in NSW, understanding the distinction between strata and landlord cover is vital.

To recap:

• Don’t rely on strata insurance alone
• Choose landlord insurance that’s tailored to strata properties
• Ensure cover for rental income loss, tenant damage, and liability
• Avoid common traps like underinsurance or inflexible policies

For more help finding the right landlord insurance policy or understanding your obligations as a strata landlord, speak to the team at Netstrata. We’re here to help you protect what matters most — your investment and your peace of mind.