Landlord insurance gives you vital protection from damages caused by tenants or arising legal issues. Each landlord’s property portfolio is different, so when faced with unfamiliar situations, having the right type of cover is crucial.
Landlord insurance isn’t compulsory but it may be required by some lenders when taking out a buy-to-let mortgage and is useful to have when letting out your property to tenants. With a good policy in place you will be protected against loss of rent, accidental damage and other financial areas.
Portfolio policies are available to landlords who own multiple rented homes, this makes managing properties less time consuming and allows you to insure them all at the same time.
There are 3 main types of landlord insurance available with add-ons also available to suit your needs.
This is a requirement for buy-to-let mortgages and covers your for the following types of property damage:
You can take out contents insurance as an add on or a standalone policy to cover the costs of repairing or replacing items you have provided in the property such as furniture, carpets and electricals.
Liability insurance (or property owners liability cover) protects you from injury or damage related compensation claims made by a third party, this could be the tenant, a visitor or tradesperson. This could become invaluable and is included as standard in some insurance policies, with some providers where this can be added as an option extra with some more enhanced cover features.
You can expect to pay 15% - 20% more for landlord’s insurance than you did for a homeowners policy. Risks can differ between tenants and homeowners, so there will be more to protect and cover.
Although a landlord’s insurance policy is not legally required, standard home insurance will not be valid when renting out a property. Your lender may not let you proceed and allow tenants until you take out dedicated insurance.
You should keep your insurer informed of any refurbishments made to the property, unoccupied periods of more than 30 days, changes to rent and new tenants. Your insurer can provide a full list of things you should keep them up to date with.