Where is that cheap landlord insurance?
Cheap landlord insurance – the very term tends to conjure up four immediate questions:
- is it necessary?
- why can’t I use owner-occupier buildings and contents insurance?
- where can I find cheap landlord insurance?
- what does it cover?
Owner-occupier insurance and landlords
Your property is typically no longer classed as owner-occupied the moment you start renting it out – and this may include even if you’re just renting a part of it.
By definition you have tenants and your risk profile has changed. You may wish to have landlord insurance to reflect that.
Owner-occupier insurance is no longer going to cover you in those circumstances.
Even if you’re only renting out a room or two in a property you otherwise occupy as the owner, any existing owner-occupier insurance may be immediately invalidated.
This is not something you’ll want to discover in the context of making a claim!
Why different policies are required
You risk profile as a landlord has changed for several reasons and typically insurance companies regard rented properties as being at higher risk than owner-occupied ones.
You may wish to consider:
- third party public liability protection in case your tenants suffer injury that they and perhaps a court, attribute to your responsibility;
- empty property cover (also called vacant property insurance) – for those periods when your property is standing unoccupied in between rentals or while it’s being redecorated and refurbished..
Misconceptions
It may be well worth avoiding the temptation to somehow make-do with owner-occupier cover as opposed to landlord insurance.
Firstly, if you were applying for a new policy you would need to falsely declare the occupancy status of the property. Insurance providers can and do check this and if the reality is discovered you will typically not only fail to get cover but may also be listed as someone that has tried to obtain insurance under false pretences.
Secondly, if the usage of your property changes from owner-occupied to rental and you fail to declare this at the time you may find any subsequent claim is refused. Once again, typically insurance companies check the status of the property involved in a claim and if you are found to have made a false declaration as part of the claim, this may in some situations be interpreted as fraud.
Both situations are perhaps best avoided, particularly given that the extra cost of landlord or buy to let insurance may be relatively small in the overall scheme of your business.
Playing it safe
If the occupancy of your property changes or if you decide to start letting out a property, checking out the options for cheap landlord insurance may make sense.
Tags: Cheap landlord insurance