August 21, 2014

What is the minimum insurance cover I should have as a Landlord?


Being a landlord can be extremely stressful at times. Many people have the ill-conceived notion that landlords simply kick back and collect money from their tenants. This couldn’t be further from the truth. Being a landlord means constantly keeping on top of your payments and the maintenance of your property. You have a responsibility to your tenants to ensure that the buildings are safe and well-maintained. Before letting any property you need to take out an insurance policy for all the property that you own. Landlord insurance differs significantly from regular home insurance in a number of different ways. You should be aware of all the options available to you so you can make an informed decision.

If you own property and are letting it out then the absolute minimum level of coverage you should have is building insurance. This covers structural damage that may occur to the property from fire or water damage. This doesn’t cover the contents of the property however, which is certainly a problem if you’re letting out fully or partially furnished housing. Contents insurance can be purchased separately though it should be noted that this does usually not cover malicious damage caused by tenants.  Unfortunately this can occur when there are disagreements so it is better to try to avoid such situations. You are covered for any intentional damage to the structure of the building however though it can sometimes be difficult to ascertain whether the damage was done intentionally so it’s best to be as well covered as possible and let the insurance company investigate.

Rent protection insurance is another type of cover that you should seriously consider. As the name suggests – it covers you for non-paying tenants. Unfortunately this is something almost every landlord will have to deal with at one point and it is much less stressful when you are insured against it. This type of cover can also include legal costs should you need to take a take to court. This is a big plus as legal fees can soon add up. You should check the details of your policy to see if this is included.

As a landlord your time is precious and often in short supply. For this reason it is a relief to know that there are many excellent landlord insurance companies online who are able to set up your policy directly over the internet. You should look around for a company who will provide the cover you need at the best possible price. Get as many quotes as you can so you can make an informed decision.

Protect your investment


For first time landlords who have many questions about how to protect their investments check out websites on the internet to find plenty of information, tips and guidelines of how and where to buy the best landlord insurance. Insuring your property or properties should be at the top of your list of things to do as it protects not only the buildings but contents too if you let your property out furnished.

Ordinary home insurance isn’t sufficient to cover buy-to-let property so online brokers suggest that all landlords should purchase the correct type of insurance along with additional cover that is also available.

Landlord liability insurance

This additional insurance cover is essential if a tenant is injured or becomes ill due to being in your property which you may be held responsible for. If the electrical wiring was faulty in any way and the tenant was electrocuted for instance you would have been negligent because the wiring should have been thoroughly checked and repaired, if damaged, before letting out the property. Liability insurance covers you for any compensation your tenant may claim along with any legal expenses that could be incurred if you were taken to court for any reason. Click on http://www.thepropertyinsurer.co.uk to see what this reputable online insurance company has to offer, for more in-depth information why not make contact by telephone or e-mail when any questions you may have can be fully answered.

What does landlord insurance actually cover and what are the costs?

Landlord insurance policies cover the following:-

  • Loss of rent if your tenant fails to pay
  • Accidental or malicious damage to the property or its contents
  • Legal expenses
  • Employers’ liability – this is useful if you have employees working for you and are injured while working on your property then decide to make a compensation claim

The costs for landlord insurance vary quite considerably depending on the location of the rental property, risk of flooding which could be a threat to the building and security measures you have taken to protect your investment. Brokers will offer lower premiums if you have an alarm fitted to your property along with sturdy locks on doors and windows, it’s also recommended to fully vet prospective tenants to make sure they can afford the rent. Buy fully comprehensive insurance, after all your investment is one that you want to make money from and not have to keep paying money out for repairs if under-insured.

Unoccupied property insurance compare: what you need to know


Landlords who let out their properties to tenants may want to ensure that they protect their investments by getting the most suitable insurance policies for their needs. However, some landlords do not carry out the unoccupied property insurance compare process properly, and this may leave them at risk of being uninsured when they come to make a claim.

A basic overview of vacant property insurance

If you are wondering why you may want to take out insurance for a property which is unoccupied, you may be interested in finding out a bit more about what this type of insurance is.

Basically, if you own a property which goes unoccupied for over 30 or 45 days (depending on the provider), it is classed as an unoccupied property. If you then need to make a claim on your standard home insurance policy, you may find that it is rejected.

The reason for this is that an unoccupied property may be seen as being at greater risk to theft as well as damage caused by such problems as burst pipes. The logic is that if there is no one in the property to spot the problems, then the risk is increased.

Benefits of this product

Landlords may benefit from this insurance if:

  • they need to carry out extensive work on the property and are unable to let it out for over 30 days as a result;
  • they find it difficult to find tenants for over 30 days and the property stays empty.

But unoccupied property insurance may also be useful for owner occupiers too, rather than just landlords. For example:

  • you may go on an extended holiday for over a month and leave your home unoccupied;
  • you may have to work from a different location for a long period of time;
  • you may carry out renovations on your property and stay with a friend whilst these are going ahead.

Is it included in a standard landlord insurance policy?

Insurance for a vacant property is not covered in a standard landlords insurance policy, nor is it standard in a building and contents insurance policy. Instead, it is a separate policy which you may want to consider if your circumstances dictate.

Unoccupied property insurance: compare cover

If you are keen to find this type of insurance product, whether you are a landlord looking for let property insurance or an owner occupier, you may find it worthwhile to compare the options for unoccupied property insurance.

A simple landlords insurance guide


As with many kinds of cover, a simple landlords insurance guide needs to take into account the wide range of different types of buy to let insurance. Although there may be similarities with standard home building and contents insurance, there are additional features of particular interest to landlords:

Common features

Buildings

  • just as you might find in your own home insurance cover, insurance of the structure and fabric of a buy to let property typically forms a core element;
  • such landlords buildings cover is important for the protection of your major investment in the property to safeguard it against the potentially crippling risks such as fire, flooding, storm damage, impacts and falling debris;
  • as is the case with other forms of property cover, simple landlords insurance is likely to require an up to date and regularly reviewed evaluation of the property to ensure that the total sum insured remains sufficient for the complete reconstruction of the premises in the event of a total loss;
  • it may be worth noting that not all insurers include subsidence in the list of perils covered. Some, however, include this as a standard feature of all their policies. It may be a question of choosing the right insurer, therefore, if subsidence is a risk you suspect;

Contents

  • the other common core element of simple landlords insurance is typically cover for your contents of the let property. Although insurance for your tenants’ property and belongings is a matter for themselves, you may wish to safeguard the contents you, as landlord, continue to own;
  • once again, regularly reviewed and up to date evaluations of your contents may help to ensure that there remains a sufficient level of cover to repair or replace items that become accidentally damaged, are lost or stolen;

Landlords

  • although buildings and contents components might be standard features of many types of property cover, simple landlords insurance may typically offers added safeguards specifically designed to meet your particular needs;
  • with respect to public liability, for instance, your role as landlord may expose you to the risk of claims alleging breaches of your duty of care towards them. Public liability cover under the terms of simple landlords insurance might adequately safeguard you against such claims;
  • whilst a home rendered uninhabitable by one of the serious insured events might leave you with nowhere to live, if your buy to let property is destroyed you stand to lose the rental income, too. Some insurance policies for such properties therefore also include landlord rent insurance which may compensate you (up to certain limits) for such loss of rent;
  • no simple landlords insurance guide is likely to include all of the features of every possible type of cover, however. More detailed investigation of the current packages available is likely to be well worth your while.

Unoccupied home insurance considerations


Owning a buy to let property that is empty and not generating rental income, may not be what you had in mind when you decided to become a landlord and while you may do your utmost to prevent this loss of income, there may be times when it is completely outside your control. In these circumstances, you may need to consider unoccupied home insurance.

Period of vacancy

Your existing buy to let landlords insurance may provide appropriate cover for your purposes while you have tenants in place.  If your property is empty for extended period though then your buy to let insurance may cease to provide cover.

With some policies this may happen after 30 consecutive days though with some others this may extend to 45 days. You may typically need to study your own policy to understand the exact position for you.

Different risks

Unoccupied home insurance is specifically designed to offer protection for the variations in risk profile that may typically occur when a property is empty.

Having tenants in your property may result in issues that might potentially develop into something more serious, being caught and dealt with early. This may include situations such as a broken window allowing weather related damage to happen or a leaking pipe causing extensive water damage.

Vandals and thieves may also be on the lookout for properties showing no obvious signs of habitation.

Terms and conditions

There may be terms and conditions contained within a typical unoccupied home insurance policy, which may be quite different to those you may be familiar with in your buy to let building insurance.

There may, for example, be a condition that requires that you have your property inspected on a regular basis (perhaps weekly) to check that everything is ok and to carry out any necessary repairs or on-going maintenance work.

This might include keeping the garden tidy and free from rubbish. You may also be required to keep a log of these visits.

Sensible precautions

Of course, your policy may also ask that you take some sensible precautions to help to keep your property safe while it is unoccupied.

For example, setting up timers to automatically turn a few lights on and off may help to give your property a lived in look that may deter thieves.

In the winter, unless you are keeping the heating on at a low temperature to avoid frost damage, unoccupied home insurance policies may also typically suggest that you drain down all heating and water systems.

What does landlords insurance cover?


The answer to the question, what does landlord insurance cover, may appear to be deceptively easy.

Some people may answer the question by simply saying:

  • buildings, fixtures and fittings cover;
  • contents insurance;
  • third party public liability cover.

That may be broadly correct, however, the position may become a little more complicated if you consider wider areas of protection when thinking about what does landlord insurance cover.

Some landlords buildings and contents insurance may offer cover for what may be considered to be business risk areas, sometimes including things such as:

  • a loss of rental income in the event that you are unable to rent out your property while trying to recover from a problem caused by an insured risk (this may typically not include situations where you had lost rental income due to absconding tenants or where you are engaged in a legal battle with them over eviction etc);
  • malicious damage caused by tenants;
  • trace and access cover – where a tradesperson has found it necessary to damage areas of your property while they were endeavouring to find the source of a problem.

It is typically advisable to be clear in your own mind, as to what cover a let property insurance quotation and its associated policy will provide to you, if you decide to purchase it.

Some landlords may be inclined to simply select the lowest cost landlord insurance they can find but this runs the risk of starting to have debates about what is or is not covered, only in the context of a future claim.

You may find it far preferable to have this discussion with potential insurers before you have purchased the policy rather than at the time you are trying to make a claim.

Although it may appear a rather gloomy way of thinking about it, in the final analysis, your landlords insurance may be all that stands between you and potential financial ruin, should misfortune strike.

It therefore seems to be intuitively logical to take the question of the selection of your insurance seriously and to make sure that you have obtained a thorough answer to the question, what does landlord insurance cover, prior to signing any policy purchase agreements.

Trying to identify the best landlords insurance


If you have started a search trying to find the best landlords insurance, you may find the following tips to be of some use:

  • while looking, don’t lose sight of the fact that the concept of best is very subjective and may depend very heavily upon your unique situation – what is the best let property insurance for someone else may not prove to be best for you;
  • even the best landlords insurance, however you define that, may not include cover for unoccupied properties (typically defined as properties that sit unoccupied for periods exceeding 30-90 consecutive days depending on the provider) – so you may also need to search for unoccupied property insurance if your property is likely to come into that category;
  • subsidence may be a very expensive problem to remedy and one that, in extreme cases, may even require the demolition and rebuilding of a property – unfortunately, today not all landlords buildings insurance necessarily provides such cover as standard, so it may be worth looking for a policy that does;
  • some policies may also offer cover for theft or malicious damage attributable to your tenants and if you have experienced such problems in the past, you may feel that the best landlords insurance for you might need to include such protection;
  • some policies may have restrictions relating to the type of tenants they will cover and some may positively exclude tenant groupings such as DSS and students, so, if you wish to market your property to potentially any tenant, you may need to search for cover that is not restrictive;
  • if you have more than one property under administration, you may sometimes feel as if your life consists entirely of paperwork and you may be keen to reduce that whenever possible, if so, you might be particularly attracted to those landlords insurance policies that offer multi-property landlords insurance cover;
  • multi-property policies may not only offer savings in terms of administration time but they may also allow you to achieve economies of scale and more cost-effective solutions;
  • the risk of being sued under public liability provisions is ever-present for landlords and it may be prudent to ensure that your policy offers a healthy degree of financial cover – some may offer cover of up to £5 million;
  • something else that may be attractive and help you to consider an option to be the best landlords insurance for you, is loss of rental income protection – this will allow you to claim a contribution towards lost rental income in the event your property has to be emptied and tenants moved out, due to an insured risk making it uninhabitable.

Looking for cheap landlord cover


When you are looking for cheap landlord cover you may wish to consider what you need to be included in the policy and the level of premiums you are looking to pay. Remember what may be considered cheap for someone else may not be cheap for you.

Loss of rental income

If you are renting out a residential property you may be concerned about your income if you are unable to rent out your house for any period of time. If the reason for you being unable to let out your property is due to damage being cause by an insured peril such as fire damage or flooding then you may be able to claim for loss of rental income. This may be up to a certain percentage of the building insurance. You may also only be able to claim for loss of rental income for a set period of time, typically 12 months, but this does depend on the provider.

When claiming for loss of rental income you may wish to consider that most cheap landlord cover may not insure you for income lost due to tenants not paying their rent or vacating the property early without giving the correct notice. A loss of rent claim does not generally pay out for a letting agents share of the rental income.

Contents insurance

The contents of your property may be included in cheap landlord cover if you so wish. If you let your property part or fully furnished this may be beneficial to you.

Landlords insurance generally does not cover contents that you are not responsible for such as tenants own personal items. You may also find that there are exclusions to the contents cover. These may include:

  • electrical goods;
  • money;
  • certificates and documents;
  • contents damaged maliciously by your tenant (though some let property insurance providers will offer this element of protection);
  • contents damaged by an act of terrorism;
  • theft by anyone that is lawfully allowed to be in your property.

The contents of your property may not be insured if the property is left unoccupied for a period of typically 30 days or more. If you are know that your property is likely to be left unoccupied you may wish to consider looking for empty property insurance.

Buildings insurance

Finally cheap landlord cover generally includes insuring your property against perils such as earthquake, smoke damage, fire and flooding. With some let property insurance providers you may also be insured against subsidence of the building – but not always, so never assume you have this element of cover as standard, as you may not. Some landlords insurance policies include damage cause by riots, political disturbance and civil commotions as well as damage caused maliciously or vandalism. Generally buildings insurance does not cover acts of terrorism however.

Why bother with landlord house insurance


Anyone renting out a property should consider having landlord house insurance that will protect the landlord and their property.

Whether you own the property outright or have a buy-to-let mortgage, it’s essential to have proper protection in place that will cover both you and your tenants. Lenders, in fact, are likely to demand that you take out specialist landlord insurance before installing any tenants because most household policies won’t cover a property that is being privately let.

But it is also just plain commonsense to protect your investment in the same way you would insure your life, your car, your own home and any valuables you treasure. House insurance for landlords will protect the value of your investment in the event of a worst-case scenario such as fire.

There are greater risks associated with providing a rental property – you are trusting that your tenants will take care of the place and while they might, why take the chance that they won’t?

Imagine there is a disastrous fire that destroys not only your property but also your tenants’ possessions – all of you will have lost everything if you don’t have adequate cover. Recent harsh winters in the UK have also placed increasing pressure on buildings while flood, subsistence or landslip damage can cause unexpected havoc.

But there may be more at risk than simply the fabric of your property if you fail to invest in landlord house insurance. Any negligence or mistakes on your part may leave you open to a public liability claim from a tenant, a claim that could see you in court, facing hefty legal bills or having to pay out for medical treatment or compensation that could run into thousands of pounds. Liability cover added to your annual premium can eliminate this risk and offer you peace of mind.

And you can add even more peace of mind by protecting your rental income through your insurance. Add “loss of rent” cover to your policy and your insurer will pay out if your tenants fail to pay their rent or your property becomes uninhabitable and cannot provide any rent.

Take the risk out of property rental by making sure your landlord house insurance covers every possible eventuality.

Landlord Buddy works with top providers to provide insurance cover for landlords and owners of property to let. Why not visit us to get the best landlords insurance at competitive prices.

Landlords need Buy to Let Insurance and not House Insurance


A recent survey shows a worrying lack of knowledge about the need for Buy to Let Insurance if you rent out your property. The number of landlords with standard home insurance on their property is staggering. Such a waste of money as this insurance is inadequate and should they put in a claim they will not get a payout if they themselves are not permanently in residence at the property. All insurance companies have strict regulations about letting out your property and you must have a specific insurance for it.

As well as being invalid, even if you were allowed to use it for your rental property, it would still be insufficient cover. With standard home insurance there is no cover for malicious damage to your property. With standard home insurance the company presumes you are unlikely to damage your own property on purpose and try to claim, and even if you do, they’re definitely not going to pay out, but when you rent out your property this is a risk you are taking, insurers realise this and Buy to Let Insurance can cover you for such an event.

 As an add-on to your Buy to Let Insurance policy you may find rent protection insurance useful. You may well still need to make mortgage payments on your rental property and if you are relying on the rental income to meet these payments you could find yourself in a problematic situation should a tenant get in arrears with their rent, or leave owing you money. It’s well worth considering as it does happen frequently. As well as this policy make sure you take all the precautions you can when you let your property out each time. A little extra work can save you a lot of money and stress in the long run. Thoroughly check all references, run a credit check and an ID check. Ask for references from employers and past landlords. That will give you a good indication of they type of tenant they are.

If the property you rent is in any way furnished then remember to insure the contents as well as the building. Your policy is unlikely to cover your tenants possessions so do let them know that they will need their own contents policy too.