Property managers coat tail meth fears
Insurance claims for methamphetamine decontamination make up just 3 per cent of of all landlord claims, but some real estate agencies have used the scare as a reason for landlords to employ their management services.
First National chief executive Bob Brereton recently said landlords managing their own properties were taking unnecessary risks.
He cited work by one testing company showing a high percentage of homes tested positive in Auckland, Wellington and Christchurch, although it was unclear if the findings were at toxic levels or low residues.
Brereton cited a decontamination case costing $20,000. But insurance figures show the most common claims were for internal water damage from leaking pipes and overflows (30 per cent), weather-related claims (20 per cent), deliberate damage by tenants (15 per cent), and meth damage 3 per cent.
The data was collected by Initio Insurance for the Auckland Property Investors Association
The insurance cost of meth contamination out of all claims was about 6 per cent.
While water, weather, and deliberate damage claims made up 65 per cent of all claims, they only account for 30 per cent of costs.
Fire made up just over 5 per cent of claims but cost almost 60 per cent of the value of claims paid.
Initio said the single most common cause for claims was leaking water pipes, especially in older homes where maintenance had fallen behind.
Fires caused by wiring and electronics failure were the most damaging.
One of the most common sources was overloaded multiplugs and wall sockets.
Property Investors Federation executive officer Andrew King said meth contamination was a big problem, but only for a few landlords.
‘‘The old limits were low and detected small residues. The new standards will allow more tolerance. Often there’s more harm done through the stress of thinking you have a contaminated house.
‘‘We’ll never get rid of methamphetamine but we know more about it now and the levels that are toxic,’’ King said.