Is landlord insurance actually worth it in 2026?

Is landlord insurance still worth it in 2026? Premiums are rising, policies seem more complex, tenancy laws are changing across the country and cost of living pressures are intense. So, we ask (and answer) the hard question – is landlord insurance all too hard?

Good question! Early in every new year, it makes sense to think about your landlord insurance and ask the same questions you ask of every line item in your budget: 

• Is it a luxury or necessity? 

• Is it good value? 

• Can I afford it? 

• Does it bring me heartache or joy? 

• Is it still worth it this year?  

We will dive into each one below, but first:

• What is insurance? Insurance is essentially a risk transfer: you pay a premium to an insurer, who covers specific losses as outlined in the policy’s terms and conditions.
• How does insurance work? Premiums from many policyholders are pooled together, and if a loss occurs that is covered under the policy, the insurer uses this pool to pay the claim.

Now that is out the way, let's go...  

Luxury or necessity? Necessity! Yes, we are biased, but do you really want to gamble your rental? Rental properties come with risks, some of which apply to all properties (weather issues, water damage, leaking roofs, legal liability) and others which only apply to rentals, like accidental or malicious damage by tenants (or their pets) or rent default. Even great tenants can face unexpected life events that impact their ability to pay rent or meet their lease obligations, and the right insurance can make a heap of difference financially. 

Good value? So, how do you define value? If it is peace of mind, then yes. If it is avoiding being thousands, sometimes tens of thousands, of dollars out of pocket when the unexpected happens, then absolutely yes. Case in point... EBM RentCover once paid out $51,416.31 for damage + loss of rent. Without insurance, this landlord would have had to foot the bill. And if it is having access to strong support when you need to make a claim, then yes again. But the real value lies in your choice of insurer and the cover on offer. Not all landlord insurance is the same. Policies can differ significantly in what they cover, how claims are assessed, and the level of support provided when something goes wrong. Landlords should look beyond the price and pay attention to what is actually included: protection for loss of rent, tenant damage (both accidental and malicious), legal liability, and the conditions that apply when a claim is made. Just as importantly, consider the insurer’s experience, how clearly the policy is explained, and how responsive and practical their claims support is. When the unexpected happens, the right landlord insurance does not just pay a claim, it helps you recover with less stress and fewer surprises. 

Affordable? Yes, despite the fact that premiums have risen for a range of reasons including increased weather events and the increased costs of payouts (as rents increase). Consider this: Average rents for capital city units range from just over $500 per week in Hobart to $750 per week in Sydney, according to realesate.com.au. Premiums for RentCover Ultra for example (which does not include building cover) range from $343 per year in Tasmania to $475 per year in NSW. So, no matter where your rental is, the cost of insurance can be less than a week’s rent. Premium calculation FYI: Insurance costs are based on statistical risk assessment... properties with higher risk generally attract higher premiums, while lower-risk properties may pay less.   

Heartache or joy? It might be a stretch to say being protected when the unexpected happens at your rental is joyous, but it is certainly a relief. Facing big bills for storm damage, water leaks or even an illegal meth lab is certain heartache. So is the loss of rent when your tenants cannot pay, will not pay or cannot stay because repairs are underway. Landlord insurance will not stop the unexpected, but it can stop it from becoming a financial nightmare.   

Worth it? Absolutely. While landlord insurance is not legally required, going without it leaves you exposed to significant risks from liability claims to major, unexpected repair costs. Some people wonder if insurance is wasted money if they never make a claim. It is not. Insurance provides peace of mind and protection against unpredictable events you could not often self-fund. Without insurance, a total loss from fire or another disaster means you would have to cover the full rebuilding or replacement costs yourself. With insurance, a financial safety net steps in to protect you.

What landlords can do 

Choosing insurance - a step-by-step guide: 

• Identify important assets: Understand what needs to be protected, including the property, fixtures, fittings, and potential liabilities.

• Compare policy features and limits: Take the time to review different policies and choose the one that best suits your property and circumstances.

• Read the Product Disclosure Statement: Note any exclusions, obligations, or required actions for the property owner.

• Match the policy to your specific needs: Ensure it covers your property type, location, tenant arrangements, and potential risks.

• Why insure: Life is unpredictable. Insurance reduces both financial and emotional stress by providing a safety net when the unexpected happens.

Additional tips to protect cover:

• Stay on top of regulatory changes: Tenancy reforms across Australia affect rent increases, lease termination, pets, and more.

• Maintain your property: Regular inspections and maintenance help prevent claims from being jeopardised.

• Communicate with tenants: Ensure they understand their responsibilities to care for the property.

• Keep your insurer informed: Any changes to the property or your circumstances can affect your cover.

Got a question about landlord insurance and which cover is right for you? Contact the EBM RentCover team on 1800 661 662. We are here to help.  

*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 here, contact 1800 661 662 if you have any questions. 

About the author

Sharon Fox-Slater

Managing Director, EBM RentCover

Adv Dip Fin Serv (Genl) GPIB FNIBA FAIM ANZIIF (Snr Assoc) CIP

Sharon joined EBM in 1993 and was part of the core team that helped launch one of Australia's first landlord insurance policies. She has transformed EBM RentCover from a small start-up into a national operation, protecting approximately 155,000 policyholders.

Sharon is passionate about the role insurance plays in providing certainty for people, in times of uncertainty. It is at the heart of everything she does. Sharon and her team of specialists strive to educate and empower property partners and landlords, helping them understand the true value of protecting investment properties.