Ensuring adequate insurance coverage for your Melbourne rental property is a crucial aspect of property ownership, protecting you from financial loss due to unforeseen events. As of December 2025, landlords typically require both building insurance and landlord insurance.
Building insurance is essential, covering the physical structure of your property against damage from events like fire, storms, and vandalism. Landlord insurance, currently in Melbourne, provides broader protection, including cover for malicious damage caused by tenants, loss of rental income if a tenant defaults, and legal liability. Premiums vary based on factors like property location – properties in areas prone to flooding, such as parts of the Yarra Valley serviced by Fletchers, may attract higher premiums – and the level of coverage. In 2026, we’re seeing increased demand for properties with demonstrated insurance coverage, as buyers realise the importance of mitigating risk. Fletchers’ experience across the Eastern Suburbs indicates that a well-maintained property with comprehensive insurance is often viewed more favourably during the sales process. Typical annual landlord insurance costs range from $600 to $1,500, depending on these factors. It’s important to note that standard home insurance policies don’t cover rental income or tenant-related damage.
Having the correct insurance in place provides peace of mind and safeguards your investment, particularly important when preparing a property for sale.