Landlords Get Insurance Protection

June 30 - Owning a property earmarked for the rental market is not a simple matter in today's current market. Statistics show that a whopping 28% of all tenants in the country paid their rents late or not at all, and 11% of all Gauteng tenants did not pay rent at all in the first quarter of 2008.

Market analysts believe that if the cost of living increases the way it is at the moment, combined with higher inflation rates and other factors, there is a real risk that even more tenants will default on their rental payments.

A property management company, Rentmaster, is therefore offering landlords the option to soften the blow of payment default through the means of a unique landlord insurance policy, underwritten by Santam Insurance.

The landlord insurance essentially mitigates the negative impact of tenants who cannot make payments on their rented properties.

According to Lynn Kuter, the Marketing Manager for Rentmaster, the company works on the landlord's behalf and ensures that the tenant pays the rent on time. By paying for the landlord insurance policy, property owners are protected for up to three months on rental default as Rentmaster will continue paying their rent for that period of time.

This ensures that revenue from the property is secure during the time period that it takes for landlords to find new tenants after the defaulting tenants are evicted. In addition, the insurance policy covers the cost of evicting the tenant.

A recent First National Bank barometer showed that more and more people are opting to rent instead of buying because of high interest rates and further restrictions on buying homes that were placed on the industry by the National Credit Act.