The first is that landlords insurance is different to the insurance cover you would need for your own home. There are obviously many areas of similarity such as;

• buildings cover against perils such are flood, fire, storm damage etc;
• contents cover;
• personal or owners’ liability insurance.

However, there are additional risks involved when you rent out a property and these can make the insurance requirements a bit more specific.

The main reasons for this are due to the additional risks that come with having tenants and from the fact that from time to time your property is likely to be empty.

In either of these cases your property may be more vulnerable to accidental or even malicious damage.

Even the most considerate of tenants are unlikely to take as much care of your property and its contents as you yourself would or as they would if they were owners rather than renters.

An empty property on the other hand can stand out like a sore thumb and can become a target for thieves or vandals. Damage caused either accidentally or wilfully may deteriorate over time if left unremedied and be more expensive to repair.

Using a standard home policy for a tenanted property would result in any subsequent claim being rejected and you may find it difficult to find alternative insurance elsewhere.

Getting the right mix of cover for your property may typically depend on a wide range of factors including;

• the type of property you have – house, flat etc;
• the type of tenants you cater for – short or long term, families, students etc;
• where your property is;
• is it furnished or unfurnished;
• are you planning to have the property lying empty while renovations or repairs are being carried out;
• if you are prepared to accept an excess.

If you find the prospect of sorting all this out for yourself a bit daunting then you may benefit from using the quote system on our website to get some options for landlords insurance tailored to your exact requirements and budget.

It is the fact that your property is your business that’s important. That’s because the insurance you require needs to protect you against not only the conventional property risks such as fires and storms but also the commercial risks that are unique to rented-out properties.

Sadly, such risks do exist. The level of protection offered varies between landlords insurance policies and insurance providers but cover may be available for things such as:

• theft or destruction of your contents, fixtures and fittings;
• wilful damage to your property or fixtures and fittings caused by tenants;
• public liability insurance – to protect you against claims from people that they have suffered injury as a result of being on or within your property;
• empty property cover – to cater for those times when your property may be empty between lettings and is, as a result, more vulnerable to things such as forced entry, vandalism and unnoticed troubles such as burst pipes.

Of course, because it is providing greater cover, a landlords insurance policy will typically be a little more expensive than the usual owner-occupier home buildings and contents insurance. This factor may lead to the view that it would be possible to economise by using an owner-occupier policy.

That may be a grave mistake. In the event of a claim, you would be making a potentially fraudulent declaration and insurance companies do have ways open to them of checking to see if your property was being rented out at the time of the incident resulting in a claim.

It’s also typically advisable to be very cautious about even casual and informal lettings. Even if you rent out a part of your property for a very short period, such as a room or two during the holiday period, your property may immediately be deemed to be a commercial concern and therefore your existing owner-occupier policy would become invalid.

Whether your property is an apartment or a fully detached house, it is providing you with income. That income may be critically important to you and taking chances with it may not be advisable. If you’re unlucky enough to suffer a problem with the property that puts your income at risk, you will want to get it fixed as fast as possible.

Having the appropriate type of landlords insurance in place may be key to helping to achieve that.

However, there is more to a landlords insurance policy than simply protecting the bricks and mortar. There is also the element of cover needed to protect yourself financially against claims from a third party – such as a tenant – for loss, damage or injury caused to them while in your property. Read on….

Once you’ve bought a suitable buy to let property and started letting it out to tenants, you’ve also taken on the role of landlord. The relationship between landlord and tenant is rather more than just one of you providing the accommodation and the tenant paying for it. You have certain responsibilities towards those tenants, the breach of which might result in you facing substantial claims for liability. To help protect you against the cost of such claims, landlord insurance is available.

So what’s the liability?

You as a landlord have a basic duty of care to ensure that the property you rent out is safe for tenants to inhabit and that the tenants’ possessions come to no harm as a result of any defects in the property itself. What does this mean in practice? As an example, it means, that if the tenant happens to trip over a frayed carpet that has been laid in his or her flat, then the tenant might try and claim for damages against you, the landlord.

The trigger for a claim might even be as apparently minor as a poorly fixed shelf coming away from the wall. But if the tenant’s expensive audio system was on the shelf when it came crashing to the floor, you might be faced with the bill for its replacement.

Damages or compensation for the physical injury of tenants, of course, might prove very expensive and could need to cover a long-term period of recovery. Landlord insurance, therefore, typically indemnifies the buy to let owner against such claims.

Not all one-sided

It’s not all one-sided, though. It’s not always the landlord’s fault. A feature of some buy to let insurance policies, for example, is the ability to arrange cover against malicious damage to the property caused by tenants themselves. Clearly, this might prove a useful safeguard (especially if you are in the business of letting to certain groups of tenants). However, it is worth bearing in mind that not all landlord insurance policies afford such protection so do check the small print.

I am going to write about arson today. In a recession, we always see an increase in fire claims. These are truly a nightmare for all parties as they are never simple, and the loss is always large. Since November last year I have seen 4 £250,000 plus fire claims so believe me when I say the risk is real. All of these have been on properties that are unoccupied and unfortunately we are seeing longer periods of vacancy between lets.

So, is there anything you can do?

Here are my suggestions:

1 ASSESS THE RISK

Identify how susceptible the property is to arson.  Is it on a corner plot?  Is there an alleyway beside it?  Are there any existing security measures?
Look for potential hazards for example is there any combustible waste next to the property?
Is the property empty?  Are there other empty properties nearby?

Record your findings and consider them.

2. MAKE SURE PHYSICAL SECURITY IS ADEQUATE

The more difficult or awkward it is for an intruder to cause damage to your property the better.  You want your property to be less of a target than another property in the same neighbourhood.  So what can you do?

Fences should be in a good condition and difficult to climb.  Simple things like trellis at the top will put people off climbing over as it will not withstand someones weight.

Any doors should have mortice locks or equivalent and when the property is empty these should be in use.  You need to record where the keys are and who has them.  When a tenant leaves make sure you get them back.  Your property is of greater value than your car and you would not let anyone have those!  If you cannot account for a set of keys, change the locks.  It may be costly but nowhere near as costly as a fire.

If the property is on a corner plot, next to an alley, or otherwise exposed,  put motion sensor lights in to make it as obvious as possible if someone is trying to break in.

If the property is empty make sure that you or someone you trust checks it weekly and records the fact.  If the worst does happen, any evidence you can provide to insurers of good practice will help make the process quick and painless.

3. COMBUSTIBLES

It may seem obvious but make sure that there are not piles of waste or rubbish next to the property.  Where possible these should be kept away from the property or removed.  Skips should be as far from the property as possible but also away from fences and walls.  Vegetation which acts as cover should be cut short and the cuttings removed.

KEY ACTION STEPS:

1 Take responsibility and be vigilant

2 Carry out a risk assessment and record the findings.  Update this regularly

3 Review the fire precautions you have

4 Control visitors, customer and contractors.

If you need more help or advice, visit the arson prevention bureau for help and guidance.  This is an increasing risk in recession.  Whilst we will help you with the problem if it happens, it is better to try and avoid it.

I sound a bit like a crusader here, but I have too much first hand experience of the real issues caused to sound anything less.

All the best

Nick

Landlords insurance covers theft in the majority of policies although it would be responsible to check the level of cover provided by your selected landlord’s insurance policy.

Crime rates are taken into consideration by the many landlords’ insurance companies and it will have a direct bearing on the price you pay for the insurance. High crime, high premium, low crime and low premium. Your landlord’s insurance company will have calculated the local rating taking into account such factors as crime types in the area, frequency of such crimes, security measures in place etc.

As a landlord you can take a number of steps to ensure your property is protected as best as possible. The obvious one being 5 lever Mortice deadlocks, locks in all windows, maybe an alarm but there’s additional steps that protect your investment further still. Something as simple as visiting or arranging with your letting agent to visit the property once a month can ensure that proper care is being taken by the tenant and no undeclared damage has been made. Your landlord’s insurance policy may have minimum security requirements that must be adhered to. This is to protect you, as the landlord, as much as your landlord’s insurance company.

The issue of cannabis farms in rented properties is becoming more prevalent in today’s society and by visiting the property once a month you are drastically reducing the chances of your property becoming yet another statistic.