Types of Landlord Insurance
Landlord Buildings Insurance
This helps cover the actual structure of your rental property along with any permanent fixtures and fittings.
If the building suffers any damage, this type of insurance could help you to meet the repair and clean-up costs.
Landlord Contents Insurance
This type of insurance covers the items inside the house.
The extent to which you've furnished the property will dictate the level of contents insurance you need.
Tenants must cover their own personal possessions themselves - that's up to them.
Why you need it
A regular home insurance policy will not normally pay out when the property is being used for business
purposes or let out to tenants.
Landlord insurance is a specialist home insurance policy that can help cover you financially for a range
of eventualities. For example, it could help you cover costs if your property is damaged, someone gets
injured on your property or you need to provide alternative accommodation for your tenants. It's a kind of home insurance for Landlords.
Whether you're just starting out or have a whole portfolio to your name - landlord insurance is one of
the best ways to protect your investment. It's a great idea to compare Landlord Insurance policies to find
the best one for you.
What does it cover?
With your landlord buildings and contents cover in place, you should be covered for damage that occurs
to the structure of the property or to contents inside it (excluding your tenants' personal possessions).
Policies may differ between providers, but typically landlord insurance will also include the following:
Legal Cover
If rent disputes arise, this cover can help you deal with necessary legal costs. This part of Landlords insurance could also be helpful if you ever needed to evict squatters.
Landlord Liability Cover
This could protect you against large compensation claims
if someone is injured as a result of a fault in your property.
For example, accidents could occur due to ill-fitting carpets
or faulty light fittings.
Rent Guarantee Cover
If something unexpected happens that leaves your property uninhabitable - this can help with the financial strain of lost rental payments. If your tenant fails to pay their rent,
this cover could also be a big help. It's important to check
all policy documents carefully so you know what events you'd be covered for.
Employers' Liability Cover
If you own a property portfolio, you may have employees
who help you manage and maintain the buildings. If any
of your employees are injured at work, this cover could
help protect you financially against compensation claims.
Multiple Property Insurance
If you own two or more rental properties, this type of buy to let insurance could offer you simplicity
as well as financial savings.
You can conveniently insure all the properties under the same one policy, making it easier to keep
track of your cover. Most of the time, buying in bulk will give you a discount and it's much the same
with your landlords insurance cover.
By insuring all your properties with the same provider, it will normally be cheaper and less effort
than insuring them all separately.
Most policies will offer you flexibility, so you can make sure you have the right level of cover for
your specific rental needs. Multi-property/portfolio landlord insurance can cover both buildings
and contents and the usual optional extras will apply.
Optional extras
The following elements of cover may be included in your landlord insurance policy or offered
as an optional extra:
Accidental Damage Cover
Quite self-explanatory this one. If your property or contents fall victim to a mishap (like some dodgy DIY) - this can help cover costs. It can usually be added to any landlord buildings or contents insurance. Again, it's wise to check exactly what circumstances are covered under accidental damage.
Home Emergency Cover
This is sometimes offered as an optional extra with your landlord insurance. If your home suffers the loss of an essential service (gas, electricity, water, heating) this can help cover expenses and get the problem fixed quickly. It's often helpful not to get very cheap Landlord Insurance because you might not always be covered for everything you need.
Unoccupied Property Cover
With a regular home insurance policy, you can normally leave your property unoccupied for 30 days without it affecting your cover. After this period, your insurance provider may refuse to handle a claim. Some landlord insurance policies can offer an extended unoccupied period - in some instances, up to 90 days. There are often very strict requirements that you visit the property weekly and drain the central heating system to prevent burst pipes.
Handy hints
If you're just starting out as a landlord, have a browse through our handy guide to happy renting.
These are our top tips for first-time landlords:
Safety first
If you've decided to rent out your property, you must ensure that all furnishings comply with
fire and safety regulations before tenants move in. Electrical installation must be safety-checked
- with regular checks taking place every few years. As a landlord, it's also your responsibility to
make sure all gas appliances are "gas safe".
Deposit protection
Landlords are no longer allowed to hold their tenant's deposit. All rental deposits must be kept
in a tenancy deposit protection scheme. Within 14 days of receiving the deposit, you must give
your tenants full details of how their deposit is protected. This information should include how
they can apply for the release of their deposit.
Energy Performance Certificate
Private residential landlords are legally required to provide an Energy Performance Certificate
(EPC) when renting out a home to new tenants. This certificate indicates the property's energy
efficiency. There are standard energy performance ratings that can help tenants compare the
efficiency between properties.
Get covered
It's highly recommended that you take out landlord insurance (or buy-to-let insurance).
Having an insurance policy in place can give you the peace of mind that you're financially covered
should the worst happen. Legal cover, landlord liability cover, accidental damage, loss of rent and
home emergency cover are some of the options you can include in a landlord insurance policy.
The agent option
If you don't want to handle everything yourself, you do have the option of appointing a lettings
agent. For a fee, a lettings agent can offer full management of your property and often a
shortened tenant-finding service. From checking references to collecting rent, they can do it
all for you.
Know your stuff
Make sure you know exactly what your legal responsibilities are as a landlord, as well as the
legal obligations of your tenants. Different landlords may agree different things with their tenants
- but make sure your agreement is clear and in writing. You can read more about landlord and
tenant obligations on the Directgov website.
Know-how
Take a browse through some of our handy landlord insurance articles: