insurance

Submitted: Monday, Feb 11, 2008 at 11:53
ThreadID: 54460 Views:1481 Replies:3 FollowUps:4
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hi
only 6 weeks to go and have found out our housesiitter will not be covered by our personal indemnity on our insurance policy unless they are paying rent which means that our insurance policy will change to landlords insurance .has anyone had same problems if so what was your way of dealing with it
thanks
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Reply By: Geepeem - Monday, Feb 11, 2008 at 13:19

Monday, Feb 11, 2008 at 13:19
HI Sayo,

Did you find out why they are not covered? Guests and visitors to your home don't pay rent and they are normally covered by the householders insurance for indemnity liability. Are you saying if you have visitors who are not paying rent staying with you for say 6 months they are not covered? I would have thought housesitters are no different to any other guest you have staying in your home at your invitation.
But if you are correct I would ask the housesitters to take out their own public liability policy and show you a current copy of the policy before they take occupancy.

Cheers,
Glen
AnswerID: 286867

Reply By: Russ n Sue - Monday, Feb 11, 2008 at 14:55

Monday, Feb 11, 2008 at 14:55
Change insurers. After reading this, I rang my mob and they just laughed and said that anyone living under the roof of the insured premises is covered. It is the address that is insured, not the occupants.

Cheers,

Russ.
AnswerID: 286883

Reply By: Member - John and Val W (ACT) - Monday, Feb 11, 2008 at 16:49

Monday, Feb 11, 2008 at 16:49
You could charge your house sitters a peppercorn rent?

Val.
J and V
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Follow Up By: Member - sayo(NSW) - Monday, Feb 11, 2008 at 18:16

Monday, Feb 11, 2008 at 18:16
hi val
whats a peppercorn rent
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Follow Up By: Axel [ the real one ] - Monday, Feb 11, 2008 at 18:25

Monday, Feb 11, 2008 at 18:25
Peppercorn rent = cost/ price of a peppercorn ,, pepper was once very expensive but 1 peppercon is next to worthless , bit like trying to put a price on 1 grain of rice,, lol.
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Follow Up By: fisho64 - Monday, Feb 11, 2008 at 18:40

Monday, Feb 11, 2008 at 18:40
perhaps a more understandable explanation would be;
peppercorn rent is a "token" sum, such as a sporting club paying $1 per year. It is soley to show that a transaction has taken place, as "free rent" etc is very difficult to show what is actually taking place.
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Follow Up By: Member - John and Val W (ACT) - Monday, Feb 11, 2008 at 18:42

Monday, Feb 11, 2008 at 18:42
Hi sayo,

By peppercorn rent I mean a very small, almost negligible rent - maybe $1 per week, something like that.

I've now realised that there is a lot more involved. Don't know the situation in NSW, but in ACTany rental property is hit by land tax. (At the time of the Canberra fires, when 500 homes were lost causing an accomodation crisis, friends who had an empty house found they simply couldn't make it available. They would need to rent it in order to insure as landlords, and if they rented, even for a peppercorn amount, they would be hit with ACT land tax. The costs were such that it had to remain empty.)

The other consideration is capital gains tax. Your home is usually exempt of federal capital gains tax, but not for any period it is rented. NSW has it's own taxes for landlords too, and also a capital gains tax for properties which are not owner occupied. (rental properties, the cottage up the coast, etc). Please check this out for yourself - I'm no authority on these things!

It's a sticky one. If you find a satisfactory solution, please post it here for everyone's benefit.

Cheers

Val
J and V
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