Landlords - we explain how to protect your rented property with a comprehensive insurance policy.
When letting a property to tenants it is essential that you have a comprehensive landlord insurance policy in place to protect you financially against the unforeseen. The insurance requirements of landlords are different from those covered by regular home insurance policies, although both buildings and contents cover are still needed, so by obtaining quotes from specialist landlord insurers you can ensure that you are fully covered.
Building insurance is needed to insure your rental property and the permanent fixtures within. The amount insured must be at least equivalent to the rebuild value of your property; this is usually a requirement by mortgage companies as a way of protecting their investment if a property is damaged beyond repair. However, specialist landlord building insurance may also include 'loss of rent' protection; this cover will pay out if, due to an insured event (i.e. fire or flood) taking place at the rental property, it is not possible to obtain rental income. Landlord insurance will usually also include 3rd party liability cover, this will provide protection if a tenant is injured due to poor maintenance of the property.
The level of contents cover needed for a rental property depends on whether the let is on a furnished or unfurnished basis. Comprehensive landlord contents insurance is needed for furnished properties, whereas limited contents insurance can be obtained to cover any white goods, curtains, carpets and light fixtures included in unfurnished properties.
The majority of specialist landlord insurance policies offer optional add-ons and although these are usually at an extra cost they can be incredibly beneficial.
By including emergency assistance in a landlord insurance policy, a helpline will be provided which can be called if emergency repair work is needed. The insurance provider will then arrange for a suitable contractor to come to the property and pay for any call out or labour charges as well as any materials and work completed up to a fixed amount.
Emergency assistance usually covers incidents relating to electricity, plumbing, cooking equipment and security measures (see individual insurers for a more comprehensive list) and can be incredibly useful.
By adding rent guarantee cover to your landlord insurance policy the insurance company will pay you rent for a set period if a tenant fails to pay rent. This cover is especially useful if there is an outstanding mortgage on the property. Legal expenses cover will provide you with the ability and legal support to evict a tenant if they are in breech of the rental agreement and also claim expenses through the courts if they fail to make rent payments.
By obtaining quotes from specialist landlord insurance providers, you should be able to tailor a policy to your exact requirements. Whether you own single or multiple rental properties you can ensure that if the unexpected happens you and your properties will be fully covered.
