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Guide to Landlord’s Insurance

Guide to Landlord’s Insurance

Use our landlord’s insurance guide to help you identify the cover you need when renting out property.

What is landlord insurance?

Landlord’s Insurance is a specialist cover designed to protect landlords for the risks associated with renting out property. Usually, landlord’s insurance would cover the building and contents against loss or damage, claims made against the insured for injury or loss and would also probably include cover for loss of rent. Even properties which are let on an unfurnished basis should have an element of contents cover for loss or damage to things like carpets, other floor coverings and items like curtain rails or light shades.

Why do I need specialist landlord’s cover?

A landlord’s insurance policy is designed to offer peace of mind and protection to landlords when they are renting out their property. Standard home insurance is not generally sufficient for a rented property and may even not be valid in the event of a claim if the insured property is not occupied by the owner. Standard home insurance would also not cover you for risks specifically associated with letting your property like damage by tenants.

Am I obliged to take out Landlord’s Insurance?

Whilst there is no legal requirement for landlord’s insurance when you are renting out a property, some buy-to-let mortgages may make it a condition of the loan to ensure that additional covers like rent protection and malicious damage by tenants are included. Failure to have the correct insurance in place in that instance could lead to financial loss to the landlord and may put you in breach of your mortgage contract which could have very serious consequences.

What landlord specific risks are covered?

Alongside the usual cover for loss and damage to the building and contents, a landlords policy may also include the following cover types which relate specifically to risks associated with letting a property.

Landlord’s Liabilities – Cover which is extended to protect the landlord against claims from the tenant or other third parties for loss or damage to their personal possessions or personal injury. An example of this may be a claim made against the landlord for personal injury caused by faulty wiring or loose flooring. It would also protect the landlord against claims made against them as a result of a contractor employed by the landlord causing damage to their possessions. For most policies the liability limit for this would be up to £2 million.

Vacant Property Cover – when you are renting out property, it is inevitable that there will be void periods where there are no tenants in-situ. Most household cover specifically excludes cover for properties which are left empty for more than 30 days at a time. Landlord’s insurance may include cover for empty property up to 90 days which maintains cover between tenants which can be especially relevant to property which is only rented out in term time for instance. It is important that if your home is left unoccupied or between tenants that you check with your insurance provider as unoccupancy conditions and periods differ between insurers.

Malicious damage by tenants – this provides cover in the event a tenant intentionally damages your property or contents. Most policies are limited to the amount of cover provided under this section.

Loss of Rent – This would cover the landlord should the property become uninhabitable by the tenant following an insured event like a flood or a fire. Loss of rent is particularly important for landlords who are renting out buy-to-let property as the mortgage will be payable on the property regardless of whether there is any rent coming in. Loss of rent cover does not include paying the rent during void periods due to normal tenant changes.

Alternative Accommodation – Some landlord policies include cover for alternative accommodation which would pay the tenant’s expenses in the event that they were no longer able to inhabit the property – for example, whilst repairs take place following storm damage or a flood.

Optional added cover can usually be included on landlord policies for things like rent guarantee – which would pay the rent in the event that the tenant does not and legal expenses, to cover the cost of any legal or court fees incurred whilst evicting a tenant.

You may also be able to add optional home emergency cover which could offer 24hr helpline access to assistance for home emergencies like broken boilers, gas leaks or floods.

If you are looking for landlords insurance, we are able to offer a choice of competitive policies from a range of different insurers via our online comparison portal – to see what is available and compare quotes for landlords cover to buy online click here.

If you would prefer a bespoke illustration for a letting portfolio or commercial lettings or just need some more information or advice about insurance for landlords – get in touch with a member of the team.

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