Insuring your rental property is just as important as insuring your own home, so here is our guide for landlords to get started on the right track when protecting their rental market assets.
What is landlord insurance?
Landlord insurance protects landlords and their properties from the risks that come with renting out a property. It offers specialist financial protection for a range of scenarios. So, when choosing insurance for your rental property, it’s essential to ensure that these scenarios are covered to avoid financial risk and to protect your ability to let a property.
Why do landlords need special insurance?
For the same reasons that homeowners need insurance, landlords also need insurance. But landlord insurance is specifically tailored to meet the needs and potential risks of renting a property.
Landlord insurance isn’t a legal requirement, but many insurers demand an appropriate level of insurance and tenancy agreements may also stipulate insurance needs.
The right insurance cover helps landlords avoid financial risks. Even though you can’t know what’s happening in your property all the time, at least insurance offers peace of mind that any risk is mitigated because you will have the financial means through your policy to deal with any problem.
What can landlord insurance cover?
Landlord insurance is specifically focused on the kind of risks that landlords can be exposed. Some insurance coverage is standard while other aspects are additional, but this is great for landlords because it allows them to create an overarching policy tailored to their needs.
Landlord insurance policies can cover the following:
- Buildings. It’s important to ensure the policy covers the cost of repairs and a complete rebuild.
- Contents. White goods, furniture, furnishings, fittings etc., lost or stolen. Tenants can insure their own belongings.
- Loss of income. Whether tenants fail to pay rent or the property becomes uninhabitable for a period, the loss of any rental income can be covered.
- Liability. Protecting against compensation claims made by tenants or visitors.
- Accidental damage. For example, breaking a window or putting a foot through the ceiling when in the loft.
- Tenant damage. Tenant deposits can cover the cost of some damage, but insurance can make up any shortfall.
- Legal cover. This can help with legal fees if a landlord has to go, or is taken, to court.
- Emergency assistance. For a broken boiler, split pipes, security, etc.
Multiple rental properties can also be insured under one policy when arranged with the insurer, making it easy for landlords to ensure that all of their properties have the right cover.
How much does landlord insurance cost?
The insurance cost depends on several factors, such as the property’s condition, the number of contents, any extras requested, rebuild expenses, etc.
When choosing your cover, it’s just as important to know what is excluded and what’s covered. A policy may seem cheap, but if it covers only some of what you need, it may be a waste of money because you can’t rely on it in the worst-case scenario.
When thinking about costs, also be aware of the excess charge. Choosing a higher excess may make your policy cheaper, but you might need to pay more for making a claim. Are you comfortable having the money when needed to cover the excess charge?
How do I find the right landlord’s insurance?
Find a policy that covers all you need and factors in any loss of rent. Decide the cover required by the value of contents and cost to rebuild. Also, consider the additional extras such as emergency cover or liability insurance.
You can use comparison sites, insurance companies or a specialist insurance broker to find the best deal, but importantly, seek specialist advice if you need more clarity about the coverage you need. Buying the right insurance is critical for reducing the impact of a potential disaster.
Finding the right insurance is just one of the many tasks facing landlords. If you’d like to discuss how No Letting Go’s local support national network could become your inventory partner, streamlining costs, including insurance premiums, and reducing your workload, then contact No Letting Go today.
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