Loss of rent in EQC repairs

Question from Abby updated on 14th April 2015:

I have loss of rent insurance on my rental property and I have EQC work coming up. If my tenants are not on a fixed term, do I still get the rent covered during the repairs? I know it probably depends on the policy, but I wonder if I should put them on a fixed term?

Our expert Myles Noble responded:

As long as the same type of lease was in place with the tenants at the time of  the earthquake and the insured can evidence this (i.e. some kind of documentation showing a periodic lease existed at that time) then they should be able to get rental for the period the repairs are undertaken. Just because it is periodic in terms should not prejudice the insured, particularly if they can show it has been ongoing for some time. Having said that it should be noted that different policy wordings may impact on how loss of rents cover is triggered. It is also worth noting from a general perspective that should your property be unoccupied when a loss occurs then loss of rents cover would not normally be available.

Myles Noble is head of claims and earthquake response for Crombie Lockwood. He also holds various advisory board positions in the insurance industry.

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