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Tenant drug lab clean-up bills spike

03 July 2014 Staff Reporter

With the number of properties rented for use as illegal drug laboratories on the rise, the clean-up bills for property managers appear to be heading in the same direction.

Last month, Residential Property Manager reported a Perth rental property that was used as an illegal drug laboratory by the former tenants has racked up over $40,000 worth of damage.

Now, general manager of EBM Insurance Brokers RentCover division, Sharon Fox-Slater, has said that while relatively small in number, there was a record 15 claims for costs associated with cleaning up clandestine drug laboratories in the past year financial year.

She said this has led to a combined total forensic clean-up bill of more than $350,000 for the year, or an average of more than $23,000 per property.

Meanwhile, other highlights from the financial year for RentCover included a Victorian investment property where every tap was left running for a week and suffered such severe mould it was declared a total write-off by its landlord insurance.

The insurance experts said this unusual incident is among more than 4,200 claims received by the RentCover division in the 2013/2014 financial year, when a total of more than $12 million was paid out.

In the case of the above incident, the tenant had moved out of the property in Tarneit in April without notice. When a property manager visited a week later, sinks were overflowing – every tap had been left running, with plugs still in place. The property was covered with mould and there were high levels of moisture in the air.

Ms Fox-Slater said it was "the worst case of mould damage she had come across in 20 years' working in landlord insurance".

"It’s difficult to imagine how an incident like that could be prevented, short of posting a 24-hour guard on every property,” she said. 

Tenant drug lab clean-up bills spike
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