Honourable and personal residential letting experts

12Jun

Insurance: have you got the safety belt you thought you had?

When buying and owning rental properties, it can of course be a great investment, but no matter how prepared your property is, things can go wrong at any moment. The possibility of flooding or something breaking down, or even your tenant suddenly being unable to meet their rental payments means that as a landlord, making sure you are adequately insured is a must!

Landlord insurance is a specialist type of cover for rental properties, covering the risk to your property and investment. It is vital to understand that without a specific landlord product, you will unlikely be covered. The level of coverage you need as a landlord very much depends on the risk you are willing to accept. For example, if the tenant stopped paying the rent, could you keep up the mortgage payments? Or if something broke down like the heating, could you cover the cost of any work or maintenance without it causing financial strain? If the answer is no, then you need adequate protection.

But what are the main types of cover you should look at?

Different types of landlord cover include:

  • Buildings insurance – typically protects you from damage caused by flood, theft, fire, and weather damage. Depending on the insurer and product, this type of coverage could include more benefits. It is always worth checking cover for tenant damage too.
  • Contents insurance – in cases where you let a furnished property such as an HMO, this could well be valuable.
  • Liability insurance – public liability cover protects the landlord if the tenant claims them if something were to go wrong whilst living legally at a property.
  • Rent guarantee and legal protection – this type of insurance covers a non-paying tenant. Typically, rent arrears would be covered for a certain period along with the legal costs of an eviction. Landlords often confuse this for another type of rent guarantee insurance which would only protect if the tenant had to move out for an insured event such as fire or flood.
  • Home emergency cover – this type of cover typically offers emergency maintenance if there is an issue with gas, electric or water supply. For example, a faulty boiler, burst pipe or blocked drain.

Whether you feel you have adequate coverage or not, I would recommend conducting a review of your insurance products, understanding exactly what is covered and ensuring you have everything required in place for total peace of mind. If you would like some advice from one of our lettings experts on this or any other topic, we welcome you to book a free consultation call.