The insurance disclosure duty

What the duty actually is

Under the Residential Tenancies Act, a landlord must provide insurance information in any new tenancy agreement. Specifically: whether or not the property is insured, and the excess amount of any relevant policies. The agreement must also include an insurance statement informing the tenant that the policy for the property is available on request. And if that information changes during the tenancy, the tenant has to be told within a reasonable time.

Tenancy Services publishes an insurance statement template for exactly this purpose.

Why the excess in particular

This obligation makes a great deal more sense once you see what the excess does elsewhere in the Act. A tenant who causes careless damage is liable up to four weeks' rent or the landlord's insurance excess, whichever is lower.

So the excess is not incidental information about your commercial arrangements. It is frequently the number that determines the tenant's maximum financial exposure for an accident. Requiring you to disclose it is requiring you to tell the tenant the ceiling on their own liability — which is why the obligation exists and why it is not optional.

It also has a practical edge for you. If a tenant was never told the excess, and a dispute later arises about what they owe, you have handed them a straightforward argument about what they were told they were risking.

Where it sits among your other agreement duties

The insurance statement is one item in a longer list. Every tenancy agreement must include:

• full names and contact addresses of the landlord and tenants;
• the address of the rental property;
• the date the agreement is signed and the date the tenancy begins;
• an address for service for both parties;
• whether the tenant is under the age of 18;
• the amount of any bond charged;
• the rent amount, the frequency, and how it will be paid;
• a list of any chattels — furniture, curtains and other fittings — provided by the landlord;
• the end date, if it is a fixed-term tenancy;
• a signed healthy homes compliance statement.

The chattels list is worth pausing on, because it connects straight back to insurance. Those items are yours, not the tenant's, and Tenancy Services states that damage to them is not covered by the tenant's contents insurance. Listing them in the agreement and insuring them are two halves of the same job. More on landlord's contents.

Records you must keep

Landlords must keep the following during the tenancy and for 12 months after it ends:

• any variations of the tenancy agreement;
• any inspection reports carried out by or for the landlord;
• records of building work requiring consent, prescribed electrical work, sanitary plumbing, gasfitting, or other maintenance or repair work;
• any tradesperson's reports or assessments relating to compliance with section 45 or section 66I of the Act;
• records relating to healthy homes compliance;
• any advertisement for the tenancy, including from before it started;
• notices and correspondence with tenants and prospective tenants.

That file is also, incidentally, what you will reach for if your insurer asks you to demonstrate you screened your tenants — a condition Tenancy Services notes some insurers impose before accepting a claim.

Contact details

If your contact details change during a tenancy you must provide updated details to the other party within 10 working days, and tell Tenancy Services within the same period if they hold a bond for the tenancy.