If you are a landlord, it naturally makes sense to have a good understanding of landlord insurance. After all, protecting the investment in your property may be high up on your priority list and buy to let cover may help you do just that. (In fact, if you have a mortgage on your property, then typically it will be a condition of the cover that you have adequate buildings insurance at all times in order to protect both your financial interests).
Landlords insurance doesn’t have to be either complicated or horrendously expensive. In fact, simple landlords’ insurance is available – and it may provide all the protection you need.
By the same token, though, it’s important to recognise that everyone is different. So, understanding that what is the best let property insurance for someone else may not be the best landlord insurance option for you is key. One of the ways to find the most appropriate let property insurance (in terms of the cover offered and at a price that meets your budget), is to compare landlord insurance quotes.
With that in mind, we share some tips on what you may need to consider when choosing your landlord insurance cover.
Comparing your cover options
Making a landlord insurance comparison isn’t as hard as it may sound, and it may result in your obtaining more suitable cover. Using our service, you can quickly access landlord insurance quotations to find the most suitable solution for you.
Although the price of the premiums you pay may be an important consideration, it is by no means the be-all and end-all of landlord insurance. Your property is a major financial investment and what may be far more important than a few pounds is finding cover that meets your needs.
The key message is to try and take a broader perspective than price alone. Remember that if you have a problem and wish to make a claim, the price you’ve been paying for your policy will not be a priority for you – only the cover it provides will be.
A cheap landlord insurance quote for someone else may not, in the final analysis, prove to be cheap or suitable for you.
Landlord insurance in outline
From the outset, remember that if you commence letting out a property or even part of a property (including your own home) you may find that you have invalidated your existing home buildings and contents insurance policy. The risks encountered by the landlord of a let property are of a different scale and nature to those faced by an owner-occupier. Any existing owner-occupier insurance you normally have may require replacement by an appropriate form of alternative cover – for example, simple landlord’s insurance.
The cover provided by such let property insurance should be relatively familiar – typically encompassing buildings, landlord’s contents cover (if required) and third-party liability protection.
How much landlord’s buildings insurance do I need?
It is important to note that the amount of your buildings cover may not be the same as any mortgage held, your buying price or indeed what you could expect to sell the property for – so getting professional advice on a suitable level might be a sensible idea.
The amount of landlord insurance buildings cover you opt for may be a contributory factor in the price of your buy to let cover. This ideally should be sufficient to cover all of the costs including architects, surveyor, legal fees, searches, and site clearance etc, of a complete rebuild of the property.
When calculating the amount of building insurance you need, also consider whether your policy incorporates cover against subsidence. Unlike ourselves, who offer subsidence cover as a standard element of a buy to let insurance policy, not all let property insurance policies provide buildings insurance cover for subsidence. Given that the cost of resolving subsidence can be huge, this is something it may well be worth checking.
Comparing landlord insurance
Other elements you might want to include in any comparison between landlord insurance policies might include:
- Loss of rental income. Your property may be damaged to the extent that it is rendered uninhabitable by one of the events covered by buildings insurance, such as earthquakes, fires, floods lightning strikes, and the like. With most providers you’ll typically be covered for the repair costs, but can the policy also provide you with cover for loss of rental income when your tenants have to move elsewhere?
- Malicious damage. Hopefully, it will never happen to you but if your tenants decide to maliciously damage your property, some landlord’s insurance policies – again, including ours – may cover that (limits apply) and others typically won’t;
- Tenant restrictions. Not all insurers may be willing to offer cover for all types of tenant and may exclude students, the unemployed and benefits claimants, for example – other policies have no such restrictions, allowing you the freedom to do business with whomever you chose;
- Flooding. Some policies may have special provisions relating to flood risks for properties located in areas with a known history of flooding;
- Trace and access cover. Sometimes, tradespeople may need to cause damage to your property while they endeavour to find and repair the source of a problem (e.g. leaks) – some policies may cover such situations under what’s called Trace and Access cover, but other policies may not;
- Contents. To make a landlord insurance comparison, you’ll need to look carefully at the policy’s position concerning landlords’ contents cover. Some may offer market value replacement – others may offer new-or-old. Both may have their advantages but it important to ensure that what is being provided actually meets your needs. Also, not all landlord contents insurance policies may offer the same levels of cover for some high-value items like entertainment systems, computers, and the like. Some let property insurance may have upper-value limits that may (or may not) offer adequate cover in your particular circumstances;
- Accidental damage. Is there an option to have accidental damage cover included in the insurance for landlords?
- Third-party cover. Court awards following a successful third-party claim against you may prove to be staggeringly high. Not all policies offer the same levels of cover and it’s something to look at;
- Policy terms and conditions. Some policies providing landlord insurance may contain special provisions relating to things such as safety and security on your property. For example, they may require that you fit additional anti-burglary devices such as security locks and alarms and so on;
- Unoccupied property insurance. Remember that typically a landlord’s policy won’t cover what’s called an unoccupied property, typically defined as one that has stood unoccupied for more than 30-45 consecutive days. Special empty property cover is required for that situation and it is worth checking the policy’s position.
Getting the most appropriate landlord insurance deal
To understand the cover provided by landlord’s insurance, it is necessary to spend a few minutes studying the policy details – preferably without being overly influenced by low prices alone. You will soon discover that not all landlord insurance policies offer the same types or levels of protection and you may find that some are more in keeping with your situation than others.
It is a fact of life that all insurance policies, including landlord insurance, will contain terms and conditions plus some exclusions – it is very important that these are read thoroughly and understood before making a purchasing decision, as they may significantly affect your ability to make a successful claim in certain situations.
Keep in mind when reviewing a landlord household insurance quote, that the quotation may be only an initial view of the final cost of the policy and it may also not necessarily contain full details of the final policy’s terms and conditions – to get a final price you may need to complete a full application and it will be important to read the full policy conditions before making a decision. Or, if you are unsure, you can speak to your insurance provider.
Some quotations may be illustrative and, in advertisements, it may not be unusual to see a clause alongside the headline figure stating that the price is subject to conditions – in practice advertised prices may be very much a best-case scenario and are not, in reality, a quotation as such.
The best landlords’ insurance quote for you may prove to be the one that you feel most closely matches your particular requirements for financial cover and which also offers you a cost-effective solution.
We hope these quick tips have given you some pointers on what you need to consider when choosing the landlord insurance policy that’s most suitable for you. If you have any questions relating to this or need assistance with your landlord insurance quote, please contact us. We’d be delighted to help.