Sorry which state do you live in? I don't know the full circumstances of the situation but taking 3 months to evict sounds very long time. In NSW an application for termination should be submitted to the Tribunal immediately when the tenant fell 15 days into arrears to protect your legal and financial interests. The process to eviction might take 7 weeks pending on how long you have to wait the be heard by the Tribunal.

I hate it when tenants believe they don't have to pay rent because they are claiming financial hardship. Financial hardship is not an excuse to void responsibility to pay rent rather's designed as an out for fixed term contract.

Fortunately you have insurance, which as a real estate agent recommend every property investor takes out.

Cheers

Lee

Edit

The only way to collect the money from the point of eviction is to get a court order. The problem is most of the time the cost of legal representation will outweigh the outstanding amount owed so it's better to just write it off as a cost doing business and move forward.