What is Landlord’s Insurance
If you’re a new landlord, navigating your to-do list, you might be wondering what is landlord insurance and which policies are essential for your peace of mind?
Just like residential household insurance, landlord insurance protects you from risks to your property, including from fire, theft, flood and damage by tenants.
The term landlord insurance includes buildings and contents policies, as well as rent guarantee insurance and home emergency cover.
You might buy a landlord package that covers you for all your landlord needs or you might take out separate policies. Or equally, you might choose Rent Guarantee Insurance which protects you if your tenants stop paying rent. What you choose is really down to you, and factors including the property, the level of risk you want and your budget.
The key thing to know is that you need to look for a bespoke landlord package – residential home insurance won’t cover you for letting your home to tenants.
What is covered by landlord insurance?
The main types of landlord insurance which you should consider are:
- Landlord buildings insurance
- This covers the cost of repairing the structure of the property if it is damaged by:
- fire
- theft
- vandalism
- malicious damage
- subsidence
- flood water
Landlord contents insurance
Some landlords think they don’t need contents insurance, if they rent out a home as unfurnished, but you should consider some level of cover for your fixtures and fittings and any appliances which you have supplied. If you are renting the home furnished, you will definitely need adequate contents cover, so you can replace any furniture, appliances and other items if damaged.
Landlord public liability insurance
Public liability insurance is advisable to cover you for any injury to your tenants or their guests on your premises.
Landlord rent guarantee insurance
If you would struggle to pay your buy to let mortgage if your tenant stopped paying rent or you couldn’t let the property, you might consider rent guarantee insurance. This will cover you for the missing rent, in certain circumstances.
Landlord emergency cover
Cover for boiler breakdowns, plumbing and electrical issues gives you easy access to engineers in a crisis. It can be a good move if you aren’t using a property management company or letting agent to take care of the day-to-day running of the rental home.
What is the cost of landlord insurance?
Like all insurance products the cost of landlord insurance varies depending on where you live, the size of the property, the insurer you choose and how good your home security is. It’s important to get multiple quotes but to always check them carefully to make sure you are comparing like for like and that the level of cover meets your needs. Always go for an insurer that is authorised and regulated by the Financial Conduct Authority.
Do I need landlord insurance?
There’s no legal requirement to have insurance in place, but it generally advisable. If the worst happened and your property suffered structural damage, you would probably struggle to pay the costs of major repairs or rebuilding the home altogether, so landlord building insurance is pretty much essential. It is also likely to be a requirement if you have a buy-to-let mortgage.
If you have a furnished property, you should take out a contents insurance policy, to cover all items in the rental home against loss or damage. Landlords with unfurnished properties are also advised to consider contents insurance to cover the building’s fixtures and fittings such as carpets and electrical appliances, though the level of cover will be less. When it comes to rent guarantee insurance this is a good idea if you would struggle to manage should your home be vacant for some time.
If you are a new landlord, we’d be happy to talk to you about all the aspects of renting out property, including getting the right insurance for your needs. Give us a call today.
