People who are new to being a landlord don’t always realise that they may need specialist insurance to cover the properties they rent out, which is often also a requirement for their mortgage providers. Luckily, there are many insurance options available to landlords to protect their let properties, and their income.
Here’s a quick summary providing some more detailed information on each type of cover.
Buildings insurance covers a number of insurable risks, including full replacement or repair costs, and the cost of clearing the site in case of complete destruction. The policy will usually cover the following:
You can either take out contents insurance as a standalone policy, or as an add-on to your landlord’s buildings insurance. You can choose the level of cover you need to protect your property against fire and theft, depending on whether you let the property in a furnished or unfurnished condition. Contents cover includes furniture, household utensils, kitchen electrical equipment, curtains and carpets. You can also extend the level of cover so that accidental damage is included.
Portfolio insurance is essentially buildings insurance, however the key difference is that you can insure five or more properties all under the same policy, with one premium and one renewal date. Not only does this make paperwork less taxing, but usually discounts will be applied the more properties that are added to the policy, making it more cost effective. You can also insure blocks of flats on these policies.
You can add home emergency cover to your landlord buildings and contents policy to protect your property, and your tenants, against the loss of essential services. This cover usually protects you 24 hours a day for emergencies such as:
For boiler cover, this policy will require a 12 month service.
You can add legal expenses cover to your landlord buildings and contents policy to provide you with legal protection. Sometimes this is even included as standard, so it’s worth checking your policy wording. Legal expenses will cover for the following events:
There may be an occasion during the tenancy where your tenant has difficulty paying their rent, often due to unforeseen circumstances - it can happen to the best of landlords. Rent guarantee insurance can protect you as a landlord from being out of pocket in the event that your tenant falls into rental arrears. Endsleigh’s rent guarantee policy also includes legal expenses cover, which provides 24 hour legal support, as well as covering the cost of disputes in relation to repossession, eviction and recovery of rent arrears. It can be an invaluable policy for landlords who rely on the rental income to make their mortgage payments.
With all of these policies, it’s important to bear in mind that most will have an excess to pay, should you need to make a claim.