What does let property insurance cover?

Posted: 17th Sep 2018

You may be new to the buy to let business or you might have become an “accidental” landlord, having come into property that you decide to let. In either event, you might want to consider the protection offered by let property insurance.

As the Money Saving Expert is quick to point out, let property insurance – or landlord insurance as it is also known – is not a legal requirement, but if you do not have it, the considerable investment represented by your let property is in peril.

It is in peril because of the risks to which any let property is exposed and against which let property insurance is designed to offer effective cover and protection:

Let property insurance is for let property

  • when you let your property, the standard home building and contents insurance which may have offered the protection you needed when you alone lived there is no longer sufficient;
  • with tenants occupying the dwelling, the risks are of a different order and magnitude, so that specialist let property insurance is essential – indeed, if you rely on your standard home insurance when the property is let, you are likely to find any claim rejected;

Building insurance

  • at the heart of let property insurance – just as with your home insurance – is the protection of the structure and fabric of the building itself against such potentially severe risks as fire, flooding, storm damage, impacts, vandalism and theft;
  • arrange your insurance through us here at Cover4LetProperty and the building insurance also typically protects you against the risk of subsidence and offers trace and access cover as standard – something you are unlikely to find with some other let property insurance providers;

Contents insurance

  • although your property is let – and your tenants are responsible for insuring their own possessions and belongings – let property insurance may also protect those contents you own;
  • if a tenant causes malicious damage to your property or its contents, our policies also include as standard cover against such acts (up to set limits);

Landlord liability insurance

  • the moment you let your property to tenants, you also assume responsibility for ensuring their health and safety in the dwelling;
  • if one of your tenants, a visitor of theirs, some other caller at the property, a neighbour or a member of the public suffers an injury or has their property damaged through some contact with the premises you own, you may be sued for a substantial sum in damages – especially if someone has been physically injured;
  • let property insurance therefore typically incorporates indemnity against such claims – in the case of policies arranged by us here at Cover4LetProperty, indemnity of  upto £2 million as standard with the option to go up to £5 million);

Loss of rental income

  • whether you are a full or part-time landlord, the rent you receive from your tenants is a valuable source of income;
  • that income stream is likely to be disrupted, however, following a major insured event which leaves your property temporarily uninhabitable pending repairs and reinstatement of any damage;
  • let property insurance (as an optional add-on to your policy) may therefore provide for compensation for such loss of rental income – up to prescribed limits, of course, typically related to a percentage of your total sum insured.

Although you are not legally obliged to have it, therefore, let property insurance offers valuable safeguards for the protection of both your property and the business it represents.

Do also note, that if your property has a mortgage on it, then under the terms of your mortgage contract, you are legally obliged to have suitable buildings insurance in place.