Q&A:
Questions and Answers: Tenrisk Product

What does Tenrisk do?

We help landlords safeguard their rental income, even when eviction becomes necessary. Our product specifically addresses the significant risk of tenant default and refusal to vacate, which can result in substantial financial loss.

What is the difference between Eviction Legal Cover and Rental Income Cover?

Eviction Legal Cover: This policy covers up to R120,000 in legal fees associated with the eviction process. It does not cover rental income loss.

Rental Income Cover: This policy provides both eviction legal cover (up to R120,000 for legal fees) and protection against rental income loss. This ensures that landlords are compensated for lost rental income in addition to having legal support.

How much rental loss is covered?

In cases where eviction is necessary, the policy covers 50% of the rental loss for the first month (after excess) and 100% for up to five additional months.

If the tenant absconds, 50% of the rental loss for the first month is covered (after excess).

Rental loss coverage stops once the tenant vacates the property, either voluntarily or via legal eviction.

What is the cost of the insurance?

Eviction Legal Cover: R120.00 per month.

Rental Income Cover: 3.5% of the monthly rental, with a minimum premium of R150 and a maximum of R700 per month (unless otherwise agreed when the cover is increased). VAT is included in the premium.

Does the policy cover utilities or damages to the property?

No, the policy only covers rental loss and eviction costs. Utilities and damages are excluded but can be demanded from the tenant through the letter of demand and eviction papers.

Can I get cover for rental loss exceeding R20,000 per month?

Yes, coverage can be increased on application after an assessment of the risk.

How does the excess work?

The excess is subtracted from the first rental loss payment, so the landlord does not need to pay it directly.

Example:

If the rental amount is R10,000 per month and the tenant defaults, the payout will be:
- Month 1: R5,000 (R10,000 minus 50% excess)
- Month 2: R10,000
- Month 3: R10,000

Payments will stop once the tenant vacates the property.

May I use the deposit for outstanding rent?

On the expiration of the lease, the landlord may apply the deposit and interest (if applicable) towards the payment of all amounts for which the tenant is liable including :
- reasonable cost of repair of damages to the property (excluding fair wear and tear).
- unpaid/arrear rent.
- unpaid/arrear utilities.
- other costs agreed upon between the parties in the lease agreement.

In terms of the Rental Housing Act a tenant cannot request a set off of the last month’s rental against the deposit. This does however not preclude a landlord from using the deposit for any arrear rental amount but is not advisable. The deposit is security for any damage to the property and if it is used to cover the last month’s rent, the landlord will have nothing to cover damage. It is more difficult to issue summons and claim damages than it is to claim for outstanding rent (as the latter is a liquid claim and damages must be proven).

Whom do I contact to lodge a claim?

Please submit your claim via our website: Claims | Tenrisk

When should I lodge a claim if the tenant is in arrears?

Claims must be lodged within 7 business days of the breach.

What is the usual turnaround time for claim payouts?

Month 1: Payment is made at the beginning of the second month.
Months 2 onward: Payments are made at the end of each month, provided the tenant has not made any payments.

Ensure all required claim documents are submitted to avoid delays.

What happens if the tenant pays after a claim has been lodged?

If the payment is made to our attorneys, they will refund the landlord and close the claim.

If the payment is made directly to the landlord, proof must be sent to us so we can close the claim. Any rental loss payments already made to you will need to be reimbursed.

What supporting documents do I need to submit to lodge a claim?

Be so kind to provide all the information and documentation as requested. You can submit your claim here: Claims | Tenrisk

The following documentation must be available and submitted:

Signed lease agreement.
Proof of tenant arrears (e.g., bank statements or tenant statements).
Evidence of communication with the tenant (e.g., emails or letters).
Any other information relevant to the default and eviction, we may request

If a tenant needs to be evicted, further information will be requested from you, and you must provide this as soon as possible.

Can the landlord send a letter of demand to the tenant?

No. The letter of demand must be issued by our appointed attorneys to ensure legal accuracy. If you send a letter yourself, it may delay or nullify your claim.

What should I do when the lease agreement expires?

If the lease will be renewed, contact us to update your policy. If the tenant vacates, use our Cancellations | Tenrisk page to cancel the cover.

For new tenants, contact us to vet the tenant and amend your policy. Failure to do so may void your cover. Use our New Cover | Tenrisk page.

Am I covered for rental loss if eviction is made impossible by law?

No. The policy does not cover instances where legislation or government regulations make eviction impossible. The policy will either be suspended or canceled in such cases.

What happens if the R120,000 legal fee cover is exhausted before the eviction is finalised?

If legal fees exceed R120,000, the landlord is responsible for any additional costs. Since 2006, this scenario has not occurred.

Can the landlord cancel the rental agreement after lodging a claim?

No. Only our appointed attorneys can initiate the cancellation of the rental agreement.

Is the landlord covered for repair costs?

No, repair costs are not covered under this policy.

Can the claim be processed if the landlord is not in South Africa?

Yes. However, claims can only be paid into a South African bank account.

Is the landlord covered if the unit is sublet?

No. We only cover tenants approved by us. If subletting is required, a formal agreement between the landlord and the subtenant must be established, and the tenant must be vetted and approved by Tenrisk.

If the tenant vacates without notice, does the policy cover abscondment?

Yes. The policy covers 50% of rental loss (after excess) for up to 1 month if the tenant absconds.

Can a rental agent act on behalf of the landlord to lodge a claim?

Yes, provided the rental agent has a written mandate from the landlord.

Will the policy cover evictions for reasons other than non-payment?

No. The policy exclusively covers evictions due to non-payment of rent. Evictions for other reasons are not covered.

Does the policy ensure the protection of personal information?

Yes. Personal information is only accessed for policy-related purposes, and we adhere to all data protection laws.

Does the policy cover Commercial Properties?

No, the Tenrisk policy is specifically designed to cover residential properties. At this time, it does not extend to commercial properties.

Definition of a Commercial Property:
A commercial property is any real estate used for business purposes, such as office buildings, retail spaces, industrial properties, warehouses, or multi-use buildings. These properties are typically leased out to tenants for conducting business

activities.

For further inquiries, contact us at:Email: cover@tenrisk.com

Q&A: Questions and Answers: Tenrisk Product

Q&A:
Questions and Answers: Tenrisk Product