One of your fundamental responsibilities as a private sector landlord is to keep any property you let safe and free of any kind of health hazard. Regular inspections of your property provide a way of ensuring that safety.

Regular inspections also let you spot any need for repairs or maintenance. That helps you maintain the value of your property investment. Inspection checks are a win-win result for both you and your tenants.

Just remember that you must agree access to the let property with your tenants to make any inspection checks at least 24 hours in advance – and preferably, in writing, at least a week in advance:

Legal requirements

• the law makes clear that those property inspection checks must be done, some which are on a regular basis and some which need to happen each time you take on a new tenant;

• top of that list is an annual inspection by a Gas Safe engineer of the gas supply and appliances – with a copy of the latest inspection certificate given to tenants within 28 days;

• the Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020 make it a legal obligation for the electrical installation to be checked by a suitably qualified person at least once every five years;

• the Smoke and Carbon Monoxide Regulations were last updated in October 2022 and make landlords responsible for installing, inspecting, and checking smoke and carbon monoxide alarms in all privately let accommodation;

• landlords are also legally required to have done everything reasonably possible to protect the property and its tenants from smoke damage and fire – please read our brief guide Landlords: Smoke and carbon monoxide detectors, and the Law;

• remember that HMO’s have further legal requirements, such as the installation of fire doors – please read: A Landlords Guide to HMOs;

• our Landlord Legislation Guide also provides further information:

The landlord-tenant relationship

• property inspection checks also provide you with a valuable opportunity to develop your relationship with your tenants and to learn just how they are treating the accommodation;

• if the tenancy agreement allows them to keep a pet or pets, for example, this is a time to make sure that no undue or lasting damage is caused;

• you might also want to verify that a tenancy agreement’s ban on smoking within the let property is being maintained;

• you’ll be able to assess not only any damage caused by the tenant but also listen to any requests for necessary repairs – a two-way exchange that may help develop the healthy relationship you want with your tenants;

• our Landlords Guide to Health & Safety has further information:

Repairs and maintenance

• it’s not only the tenant, of course, who will identify any needs for repairs and maintenance;

• be on the lookout for anything that might compromise the health or safety of your tenants, of course, but also use regular property inspection checks to gauge the whole range of possible tasks;

• even though there have been no visible signs of mould or damp, now is a time to stamp down on any early signs of a potentially serious problem – so watch for areas that feel soft to the tread or touch, dark stains on the walls, or flaky paint or wallpaper. Our Guide to Condensation provides useful information;

• check that there are no leaky pipes or taps – and call in the plumber before any problem becomes noticeable;

• you – and your tenants – will be glad you eradicated all signs of any pests before an infestation developed;

• once established, infestations by pests such as bedbugs, fleas, and cockroaches can be difficult to control – so timely intervention is called for.

Regular property inspection checks can help you maintain your legal responsibilities and obligations as a landlord. But they can also serve to strengthen your relationship with your tenants – painting you as a caring and responsible landlord.

Regular inspection checks are also an essential part of keeping your property in a good state of repair – a sure way to protect your investment and a precaution about which your landlord insurance provider is certain to insist.

Further reading: Landlord Checklist.

Please note that this article is for guidance purposes only and should not be deemed legal advice. Legislation can change. For further clarification, contact your local authority or lettings agent.

In the perfectly normal course of events, there may be times when your property stands empty and unoccupied. What is the status of your property insurance at those times? It might not be an issue – but it may become one. If your property stands unoccupied for more than a specified number of consecutive days, your buildings and contents insurance could be at risk.

So, who is likely to need unoccupied property insurance and what exactly does it cover?

What is empty property insurance – and who needs it?

Insurance providers look to understand the risks they are covering when they offer you a policy – that is the very nature of insurance.

Should the risks they are covering change, insurers also typically take the opportunity to reconsider the suitability of the existing policy. If the risks change sufficiently, your insurer reserves the right to decide that the existing policy is no longer valid and that something more suitable needs to be put in place.

This basic principle applies to all insurance – including property cover.

If your property moves into what is called “unoccupied status”, the risks associated with it will typically change sufficiently to justify the insurance provider requiring a different form of cover to be put into place.

If you fail to notify such a change and subsequently make a claim against the original policy, your claim may be refused.

When risks change

Homeowners

When a property is unoccupied, the risk of significant events such as burglary and vandalism increases along with relatively minor problems (a leaking pipe, for example) that if left unnoticed may nevertheless turn into major problems that cause substantial loss or damage.

At Cover4LetProperty, we know that sometimes the question of empty versus unoccupied property status can cause a little confusion for some property owners.

To be clear, the reason your property is unoccupied doesn’t matter in terms of a typical buildings insurance policy. You will typically need to take action to protect your interests in cases such as:

• the death of a relative means you’ve inherited an occupied property – whether it’s furnished or empty – since you may also be legally responsible to protect the value of the property if you’re the executor of a will;
• you are going to be working away from home for several months or so;
• you are taking an extended holiday for a similar period of time; or
• you are remodelling or refurbishing your property and need to move out for the duration of the work.

Buy to let landlords

If you are the landlord of buy to let property, one of the last things you want is the so-called “void” – the time during when no tenant is in residence, and you, therefore, have none of the rental income on which your business relies.

But there may be occasions when that state of affairs is unavoidable, if for instance:

• you have bought a previously abandoned property and are looking to refurbish it before letting it to tenants;
• the buy to let property you own is currently undergoing works and needs to be left vacant whilst the works are in progress or you’re unable to let the property when planned due to over-running re-decoration or other works;
• there is a longer than usual interval between one set of tenants leaving and new ones moving in;
• you are planning to sell the property and want to offer vacant possession to any new buyer;
• your tenants have notified you of their intention to take an extended overseas trip for business or pleasure purposes; or
• it’s proving difficult to find tenants – for whatever reason.

Reasonableness

Insurers understand that a property cannot be occupied 24/7. That is why both owner-occupier and landlord insurance policies will usually make some allowances for insurance cover to continue when the property is unoccupied for shorter durations. Those shorter durations normally include situations such as holidays, tenant changeovers, business trips and so on.

While this is reasonable and reflects real life, policy providers typically restrict the unoccupied cover included in a standard property policy to a specified maximum number of consecutive days. That figure is usually somewhere in the range of 30-45 consecutive days. The amount may vary from insurer to insurer.

Once a property stands unoccupied for longer than that specified number of consecutive days, it will become formally classified as “unoccupied” and will require separate, standalone unoccupied property cover going forward if continuity of protection is required.

Control

Your insurer typically pays little attention to the reasons for any period the property stands unoccupied and relies solely on the fact that it has become unoccupied.

It doesn’t matter whether you have experienced delays in finding new tenants or as an owner-occupier; whether you have been detained unexpectedly overseas on an extended business trip. In either case, you will typically need separate unoccupied property cover to maintain the protection your property requires.

A specific point for landlords to note is that even in situations where tenants are continuing to pay rent as normal, if they have left the property unoccupied whilst they are taking an extended holiday, for example, or a lengthy business trip, the same basic principles will apply – if no one remains in the let property for that period, it is unoccupied.

In other words, a standard home insurance policy, or typical landlord insurance policy will only maintain its full protection of your property for a specified maximum number of consecutive days without someone in residence.

So, who needs unoccupied property insurance?

Once your property is formally regarded by your insurer as unoccupied, elements of the cover provided might typically change or cease.

As we have explained, the risks from burglars and other intruders or emergencies requiring repairs or maintenance significantly increase when the property is unoccupied. The home insurance or landlord insurance that otherwise normally protects the property becomes inadequate when it stands unoccupied.

If it does become unoccupied – or appears likely to – that is when you need to compare empty property insurance policies and consider arranging unoccupied property insurance online.

Unoccupied property insurance

It may be helpful to review some of the many risks to which any unoccupied property is exposed:

Theft and vandalism

• empty and unoccupied buildings are easy targets for criminal damage, theft, and vandalism;
• the resulting dilapidation can accelerate the property’s decline and rapid loss of value;

Maintenance and repair

• when there is no one at home or no tenants in your property, problems needing otherwise routine maintenance and repair are going to go unreported and may therefore develop into full-blown incidents – a dripping tap, for example, might soon leave the property flooded;

Weather

• the British weather is nothing if not unpredictable – and when your property is unoccupied, storm damage, high winds, ice or snow may cause problems which are again unreported and have the potential for causing considerable damage;

Infestations

• a property that is left empty and unoccupied may be at much higher risk of infestation by rodents or other pests – eradicating the problem may require specialist services, suggests the government website, in view of the law and regulations on the control of such pests.

Unoccupied property insurance

At times when your property is empty for a pre-defined period, specialist unoccupied property insurance is required. Unoccupied property insurance is very much what the name suggests – it provides insurance cover for your property – whether that is your home, let property, holiday home or commercial property.

When you look more closely at just what this type of insurance covers and compare empty property insurance, however, you may find that considerable care and attention continue to be required.

Some versions of the product, for example, restore an element of cover, but it is restricted to so-called FLEA or FLEEA risks – Fire, Lightning, Explosions and Aircraft (FLEA) or Fire, Lightning, Earthquake, Explosions and Aircraft (FLEE), respectively.

Other versions may offer reduced levels of cover or exclusions for specific risks, such as flooding.

At Cover4LetProperty, we offer three levels of unoccupied property cover, so you can choose the level that is most suitable for you.

What do you want unoccupied property insurance to cover?

Empty property insurance may be tailored to cover exactly what you want it to cover.

Depending on the type of premises and the reasons for it being empty, you might choose relatively basic cover. More comprehensive protection against a wider range of risks and perils, including cover for the contents too, may be needed if the property is your own home for instance.

Your objective is to secure the level of cover you require for your particular empty property.

Comprehensive empty property insurance, for example, fully restores the protection you enjoy with your usual home insurance or landlord insurance when the property is more or less continuously occupied.

In that way, you may rest assured that your unoccupied property and its contents remain covered against the full range of risks – including fire, flooding, storm damage, impacts (from vehicles and falling objects), vandalism and theft.

Property owner’s liability insurance

Also restored is indemnity against your property owner’s or landlord’s liability, in the event of any third party – including neighbours and members of the public – being injured or having their property damaged and holding you liable. Claims such as these may run into very substantial amounts – and may even be made by persons who have gained entry to your property illegally or without your authorisation.

In recognition of the size of potential claims – especially those involving personal injury – indemnity of at least £2 million (and often more) is customarily provided. Empty property insurance arranged by Cover4LetProperty, for example, typically provides a generous £5 million of indemnity.

This gives you peace of mind against claims not only from entirely innocent parties but also from those such as squatters, arsonists and vandals who may have entered illegally (but may still have recourse to allegations that the property owner is liable for any injury or property damage they suffer).

Specialist insurance from a specialist provider

Arrange your unoccupied property insurance online through us here at Cover4LetProperty and you have the choice of cover that protects as much, or as little, as you choose.

This standalone insurance product may also typically provide cover for just as long as you need it – and unlike many other types of general insurance, may be purchased for periods of less than a year. If you are going to be away for just three or six months, for instance, your unoccupied property insurance may be bought for only that period.

This might be one of your options if the reasons for the property being empty are because it is undergoing building works, for example.

As you would before buying any other type of home insurance, carefully compare empty property insurance and all its variations – and you are likely to find that here at Cover4LetProperty we offer expert, specialist advice on competitively priced policies.

Further reading: Guide to Unoccupied Property

As the weather begins to warm up, now is the perfect time to take care of any property maintenance tasks that may have been overlooked during the winter months.

Here is our list of ideas of what to do inside and out. It is by no means an exhaustive list, but carrying out the actions below will help keep your property properly maintained …

External property maintenance

It is important to inspect your home’s exterior for any signs of damage. So …

• stand back and look at your roof – are there any slipped or missing tiles?
• are the gutters all intact and free flowing?
• inspect the windows for any signs of damage or wear, such as broken seals, cracked glass, or peeling paint;
• does the external paint need a touch-up or even a complete re-do?
• are there any cracks or any other signs of wear and tear?
• can you see any signs of water damage?
• are the walls structurally sound, properly insulated and have adequate ventilation?

It’s important to get these repairs done as soon as possible to ensure that your home remains in good condition, is protected from the elements and, any further damage is prevented.

When it comes to more serious repairs, it’s important to contact a professional. This could range from fixing a foundation issue to replacing windows.

Don’t forget regular maintenance, too. This includes:

• cleaning gutters;
• pressure washing the exterior;
• cleaning the windows.

The garden

Garden maintenance is an important part of keeping your outdoor space looking its best:

• trim and tidy the shrubs, and prune and feed the plants;
• mulching is another essential part of garden maintenance. Mulching helps to protect your plants from extreme temperatures and reduces the need for frequent watering;
• control weeds;
• regularly inspect your plants for signs of disease or pests. If you find any issues, act immediately to prevent them from spreading;
• check for the infamous Japanese Knotweed;
• feed the lawn if you have one;
• if you have paving slabs, check that there aren’t any cracks or gaps that need repointing.

Now, on to the inside ….

Internal property maintenance

Internal property maintenance is the process of keeping the interior of your home in the best shape possible. This means tending to any repairs, upkeep, and general care of the interior of your home.

The first step is to identify any necessary repairs. Start by inspecting for any wear and tear, mould or cracks and damage to:

• the walls, floors, and ceiling;
• your window and doors;
• kitchen and bathroom appliances.

Once you’ve identified any necessary repairs, it’s time to address them. Depending on the type of repair needed, you may need to enlist the help of a professional or may be able to do this yourself.

In addition to repairs, you should also focus on regular maintenance such as cleaning your doors, windows and window frames etc.

Get the paint brushes out!

Regular interior painting and wall repairs are necessary to keep walls looking fresh and in good condition. Depending on the age and condition of walls, interior painting should be done every few years. Worn or damaged areas should be repaired as soon as possible to avoid further damage.

Carpets should be professionally cleaned at least once a year, and hard floors should be refinished every few years.

Also, check:

• your loft or attic and make sure it is watertight;
• your smoke alarms and carbon monoxide detectors. (It is recommended you check your smoke alarms and CO2 detectors at least once a month. You should also change the batteries in these safety devices at least once a year);
• when your boiler next needs a service – this should be annually. Landlords also typically need to carry out extra gas safety checks;
• the electrics – again, landlords also have certain electrical safety obligations.

External and internal property maintenance is an important part of property ownership. By taking the time to do regular inspections and maintenance, you can ensure that your home or investment property remains in top condition and looks its best. This will help protect your property from the elements and keep it looking good for years to come.

Your property insurance and home maintenance

Finally, keeping your property well-maintained is typically a condition of your buildings insurance. This is because it decreases the risk of damage to the property, meaning the insurance company is likely to pay out less.

Regular maintenance also ensures that any existing damage is identified and dealt with quickly before it has the chance to cause more damage. This reduces the risk of a claim being made against the policy.

Further reading: March home maintenance and Spring property maintenance tips.

The latest UK property news focuses on the movement in house prices – examining the picture both locally and nationally.

In the private rented sector, headlines reveal the extent to which many landlords are prepared to adapt their properties to accommodate the needs of older tenants while the Renters Reform Bill is almost certain to have a major impact on this sector of the market.

Average house prices in your area

In a posting on the 31^st of January, the online listings website Zoopla published a searchable map of the UK so that you can identify the current average price of a house in your particular area.

It sets the scene by noting that the national average stands at £261,200 – a 6.5% increase in prices one year ago.

Hotspots for the strongest growth in average prices around the country are illustrated by the following statistics:

• Wigan – the highest rate of growth at 10.4%, to a current average price of £164,900;

• Wolverhampton – prices increased by 9.8% in the past year, and the average currently stands at £175,400; and

• the Scottish Borders – 9.6% growth in prices to a current average of £179,000.

If you are after the cheapest homes in the UK – with many areas reporting rates of growth less than the national average of 6.5% – Zoopla ranks the following three places:

• Inverclyde, in Scotland, where the average price of a house is just £101,500 (an increase of only 5% in the past 12 months);

• East Ayrshire – with prices averaging £102,700, up 4.3% on last year; and

• West Dunbartonshire, also in Scotland, where you can buy a house for £108,800 – paying approximately 4.4% more than at this time last year.

2023 begins with further slowing in annual house price growth

The latest house price statistics for January released by the Nationwide building society illustrate a steady decline in the rate of growth in average house prices nationally.

The building society recorded a 0.6% decline in prices in January compared with December, which were in turn 0.3% lower than the previous month.

On an annual basis, this meant that average prices had climbed by 2.8% in the 12 months to the end of December but that fell to an annual rate of just 1.1% in the 12 months to the end of January.

The average price of a house in the UK stood at £262,068 in December but this had fallen to £258,297 in January.

If current signs of mortgage rates stabilising are realised, some commentators predict that the housing market may begin to recover in the year ahead.

Landlords content to make property alterations to suit older tenants

Recent research – cited by Landlord News on the 25^th of January – suggests that many landlords would be prepared to invest in remodelling their let properties to better accommodate the needs of older tenants.

Almost a half (46%) of the landlords surveyed in the study said they would adapt their property accordingly – 21% of them said they would spend up to £1,000 on any necessary building works, 11% were prepared to invest up to £3,000, and 5% content to spend £5,000 or more on making their let accommodation more suitable for older tenants.

The willingness of landlords to make these changes is also reflected in the ageing profile of many prospective tenants. Government statistics show that the number of tenants aged between 45 and 64 years in the private rented sector has grown by 70% in the past decade while the number of those aged 65 or more has increased by 38%.

Renters’ Reform Bill likely to increase pressure on landlords

Although it is likely to result in bigger challenges and considerably greater pressure for landlords, the Renters Reform Bill is making its way through the legislative process with comparatively little notice from those it will most impact, according to Property Reporter on the 31^st of January.

The Bill tips the scales firmly to the advantage of tenants – to the detriment of landlords – because it proposes:

• abolition of the so-called “no-fault” evictions of Section 21 of the Housing Act;

• an ombudsman for the private rented sector to help protect the rights of tenants;

• outlawing landlords’ ability to refuse tenancies for people in receipt of welfare benefits; and

• granting greater powers to local authorities in the enforcement of tenants’ rights.

The Renters Reform Bill is expected to pass into law later this year – possibly as early as this Spring.

One of those all-important New Year resolutions might well have been a determination to protect, maintain, and run your home in the most efficient and effective manner – without paying more than you need to.

So, here are four tips on doing just that by putting your house in order in the year ahead.

Have a maintenance fund

One area where you can combine your twin objectives of maintaining your home in physical shape while also keeping your finances in good order is by setting up and managing a purpose-designed maintenance fund.

You know that you will need to carry out routine repairs and maintenance on your home to keep it windproof, watertight, and looking good. The problem is that some home repairs are likely to come unexpectedly – when something fails, breaks, or goes wrong when you least expect it.

By setting up a home maintenance fund or separate bank account exclusively for maintenance and repairs, you will stay one step ahead, be always prepared, and won’t let any passing emergency disrupt other essential expenditure.

How much needs to be in your maintenance fund varies, of course, according to the property involved and your individual circumstances. By way of illustration, a posting by London’s Southwark Council on the 21^st of February 2022 suggested that the average homeowner needs to put aside between 1% and 4% of the value of their home for annual repairs and maintenance.

Insurance

Whether you own your home or are the landlord of buy to let property, the cost of certain unexpected or emergency repairs – as the result of damage from an escape of water, for example – may be covered by your home insurance or landlord insurance policy. Provided that the policy is valid and up to date, of course.

So, part of getting your house in financial order must include a review of your home insurance or landlord insurance policy to make sure that it continues to provide all the protection you and your property need.

This is unlikely to be a question of cost alone but may include aspects of cover that you now need but didn’t before, or elements that were not previously relevant but have become so now. For example, you may have:

• bought a high-value item that needs an individual listing under your home insurance policy; or

• had an extension built or had the place modernised and refurbished – this added value needs to be factored into your buildings, and contents sums insured.

Of course, if you have any questions regarding your property insurance, please feel free to telephone us on 01702 606 301 – and we’d be delighted to help.

Utilities and other regular expenditure

Among the most regular payments you are likely to be making each month are those for utilities such as gas and electricity, but also your water, broadband, and entertainment packages.

Whatever sums you are paying they all mount up and you need to ensure you are paying no more than you need to. Exceptionally – and at least until March 2023 – you will want to check to make sure that your energy bills are properly discounted in accordance with the government’s Energy Price Guarantee.

Check, too, whether you are paying too much Council Tax if your home has been wrongly banded. Mistakes such as that are made in the case of hundreds of thousands of homes declared the Money Saving Expert on the 3^rd of January 2023 – yet it will only take you 10 minutes or so to check whether you are in the correct Council Tax band.

As far as your gas and electricity, broadband, and TV packages are concerned, then several online utility comparison websites can help you compare deals and make any switch you consider necessary.

Your mortgage

Finally, if your property is mortgaged, check that you are still getting the most suitable and cost-effective solution for you. In some cases – and with professional advice – it may be prudent to switch mortgage providers or products.

With the recent increase in interest rates, you may be in for a nasty shock if you are coming to the end of any fixed-rate deal. According to the Office for National Statistics (ONS) on the 9^th of January 2023, mortgage deals that enjoyed a fixed rate of interest of just 2% when they started are currently offered at an average of 6% – a significant increase.

Summary

These four tips for getting your house in order will help you check that you are still getting the most appropriate products for your own unique needs and financial circumstances – and may help you save some money too. 

Please note that the information within this article is designed for guidance purposes only and should not be construed as legal or financial advice.

You’ve probably noticed it about many financial services products that there’s often no single straightforward answer – and that’s true when you ask what landlord insurance covers. A lot depends on the type of landlord you are, the type of property that you own and, each insurer’s own definition of what their cover entails.

Before considering just what landlords’ insurance covers, it may be helpful to understand why this specialist insurance product is needed in the first place. And that also means taking a look at the role of the landlord with a buy to let business.

So, why is specialist landlord insurance necessary? Why won’t standard home building and contents cover suffice, for example?

Distinguishing between landlord insurance and standard home insurance

Owner-occupiers and landlords of buy to let property typically own homes that are to all intents and purposes quite indistinguishable – but for the critical fact that one is the owner’s place of residence whilst the other is occupied by rent-paying tenants.

On the outside, therefore, there may be no great apparent difference, but on the inside there is. The same might be said of standard homeowners’ insurance and landlords’ insurance – on the outside they appear fairly similar, but it is on the inside that the real differences start to emerge.

Those differences help to explain why landlords cannot simply use one of the very many standard home insurance policies on the market to protect the bricks and mortar and the contents of residential property which is currently let to tenants.

What matters to insurers, of course, is the question of risk – what is the likelihood of the insured property suffering loss or damage and the insurer having to pay out on a claim as a result?

It is that calculation of risk which informs the price at which any insurer needs to pitch premiums for the cover in question since it is only from income by way of premiums that insurers have the funds to pay out on claims. Those funds are held in a “claims reserve” which must be sufficient for the settlement of future claims – and, as an article in the Insurance Business Magazine on the 11^th of January 2023 insisted requires careful management.

Critical to that calculation of risk, as far as property insurance is concerned, is the use to which the premises are put:

• standard home building and contents insurance is designed to meet the risks faced by a typical property that is occupied on a more or less continuous basis by its owners;
• landlords’ insurance, on the other hand, is designed to meet the very different risks faced by a buy to let business, which relies upon rental income from the tenants occupying the premises – buy to let insurance (as landlord insurance is also called), therefore needs to protect the business uses to which the property is put.

That distinction is sufficiently critical that if you have arranged standard home insurance but in fact let the property to tenants, any claim you subsequently make may be rejected out of hand by the insurer.

Who is a landlord?

Landlords fall into two broad groups:

• the so-called professional who makes a conscious decision to earn a livelihood from buying to let; and
• the “accidental” landlord who finds him or herself becoming a landlord almost by chance, after inheriting a property or otherwise deciding to let out a home they previously occupied themselves.

Whilst there is no single profile representing the average landlord, it might be helpful to look at some of the most common profile features to gain a better understanding of why landlord insurance may be needed and just what it needs to cover.

The landscape in which today’s landlord must operate is subject to a welter of economic and legislative pressures and changes – many of which are discussed in an article in the Consumer Association’s Which? magazine on the 29^th of December 2022 and include some of the following significant developments in the year ahead:

• a long-awaited Renters Reform Bill could be finally enacted in 2023, bringing with it a completely different balance to the relationship between landlord and tenant;
• significant reductions in the thresholds at which Capital Gains Tax (CGT) becomes payable – and which will clearly impact those landlords intending to sell previously let property;
• potentially further increases in the interest rates attached to buy to let mortgages;
• increasing demand for accommodation in the private rented sector;
• the continued pressures of inflation and the rising cost of living could lead to more tenants defaulting on their rental payments;
• energy efficiency standards within the private rental sector become increasingly stringent; but
• despite the steadily escalating property prices, landlords might still be able to snap up a bargain.

The sheer diversity of these challenges for today’s landlord means that the group of property owners as a whole is disparate and reflects the wide spectrum of opportunities for operating a buy to let business. But they all share an interest in

protecting the property in which they have invested. And the best way to do that is by way of landlord insurance.

The principle of landlord insurance – and the cover it provides

What does landlord insurance cover? Just as there are many different types of landlord insurance, so the answer reflects those differences – making it important to identify the particular form of cover that meets your individual needs and circumstances.

Put most simply, landlord insurance protects your buy to let business. It protects the principal business asset – the property and its contents – and many of the additional risks and liabilities that go with being a landlord.

The role of insurance in protecting your business is critical and distinguishes landlord insurance, for instance, from the standard forms of home building and contents insurance typically arranged by home owner-occupiers

As we have explained, the risks and perils are different when your property is let to tenants and, so, specialist landlord insurance is required, rather than any standard form of home insurance.

Although the cover may appear similar, therefore, you still need to inform any mortgage lender with an interest in your property that it is being let to tenants and not occupied by you as your residence.

If there is a permanent or long-term switch to the property’s use as let premises, you may need to change your mortgage, suggests the government-sponsored Money Advice Service.

You may also need to bear in mind that some insurers decline cover on property let to certain types of tenant – such as benefits claimants, asylum seekers or students. So, if these groups are among your target market of potential tenants, still more care is needed when selecting your landlord insurance – but be assured that the policies we arrange here at Cover4LetProperty allow for all types and categories of tenant.

With these important principles in mind, it is possible to take a closer look at how landlord insurance protects you. You should note that not all elements of the following cover come as standard in any given let property insurance policy, so it is important you understand what your policy cover entails:

Building insurance

• at the heart of any landlord insurance is likely to be the protection of the physical structure and fabric of the building and its contents;
• this is protection against potentially serious risks such as fire, subsidence, flooding, storm damage, escape of water, smoke damage, impacts, theft and vandalism – it is important to note, though, that policies vary widely and some risks may not be covered or may be subject to special conditions, depending on the insurer;
• typical examples are subsidence, especially if there has been past evidence of the problem, and flooding, if your property is in an area known to be vulnerable to such a risk (all our policies provide subsidence cover as standard);
• some, but by no means all, policies also offer cover against the risk of malicious damage caused by your tenants or their visitors – those arranged by us here at Cover4LetProperty incorporate such cover as standard;
• in any event, the total building sum insured needs to take into account a worst-case scenario in which your property is totally destroyed and has to be rebuilt – a valuation based on current reconstruction costs (rather than either the present market value, for instance, or the balance of your outstanding mortgage) which naturally fluctuate over time and may need to be updated with reference to the index of reconstruction costs maintained by the Royal Institute of Chartered Surveyors (RICS);

Trace and access insurance cover

• especially useful for landlords may be the inclusion of additional cover in respect of trace and access costs;
• you may have responded to your tenants’ request for emergency attention to a burst or leaking water pipe, for example, but the cost of the plumber you call out, the damage caused by his tracing the fault and accessing it (lifting floorboards or knocking the plaster off walls, for example) and the materials used in repairing the problem are not generally covered under the provisions of any cover for loss and damage caused by an escape of water;
• trace and access insurance cover offers precisely this indemnity;

Contents insurance

• although your tenants are of course responsible for insuring their own possessions and belongings, you may own items – especially in the common areas of the let property – which also need to be protected against the risks of loss or damage through appropriate landlord’s contents insurance;

Landlord liability insurance

• property insurance in general invariably incorporates indemnity for the owner’s public liabilities – in the case of the landlord this is likely to be an even more important safeguard;
• the landlord has a particular duty of care not only to members of the public, but more specifically to his tenants and their visitors – so, if you fail to take reasonable precautions to prevent their injury or loss, you may be faced with substantial claims for compensation by way of damages;
• if any individual suffers a personal injury or has their property lost or damaged as a result of the landlord’s negligence of his duty of care, the claim for compensation may assume substantial proportions (the more so if any injuries have proved fatal, of course);
• indemnity for landlord’s liability, therefore, typically starts at a minimum level of cover of £2 million – but cover for £5 million is by no means uncommon;

Employers’ liability insurance

• if you employ others to help run your buy to let business, the law requires – in all but a few exceptions – that you hold a minimum of £5 million employers’ liability cover in the event of an individual sustaining an injury or contracting an illness or other medical condition as a result of working for you;
• on occasion, this cover may be available as an optional extra to your landlord insurance or you may purchase it separately on a standalone basis;

Loss of rental income

• recognising that your buy to let property is first and foremost a business asset, there is a risk that any one of the risks you have insured against leaves the accommodation temporarily uninhabitable, so that the income stream of your business – the rent you would otherwise collect – is disrupted;
• landlord insurance may include compensation – or the provision of similar, alternative accommodation – for this loss of rental income pending any necessary repairs and reinstatement;
• the amount of compensation is typically limited to a maximum period or the limit may be calculated as a percentage of your total sum insured;

Unoccupied property insurance

• finally, you may need to bear in mind that insurers consider your let property to be at its most vulnerable when no one is living there – when otherwise minor maintenance problems may develop into serious emergencies and when the unoccupied building acts as a magnet for thieves, arsonists and other intruders;
• although you want to prevent lengthy voids – between one tenancy ending and before another one starts – periods during which your property stands unoccupied may be inevitable;
• if the property is unoccupied beyond a given number of days – typically between 30 and 45 consecutive days, but the precise interval varies from one policy to another – your insurer invariably reduces the extent of cover provided or may even regard the insurance policy to have lapsed altogether;
• in that instance, you may need to consider standalone unoccupied property insurance to maintain the full range of safeguards for your let property – you can read more about this subject in our Guide to Unoccupied Property.

What does landlords’ insurance cover?

A great many, varied risks and perils are likely to be encountered by practically any investor in buy to let property.

Buy to let property insurance offers common, core elements of protection whatever type of landlord you happen to be. But it is clear that there is scope for considerable variation in the precise scope and level of cover you purchase.

To help you negotiate this potential minefield and ensure that you secure the cover you need – at competitively priced premiums – you might want to consult specialist brokers such as ourselves here at Cover4LetProperty.

Standard home building and contents insurance is not an option if you are the landlord of buy to let property. If you let your property to tenants, it is important that you arrange suitable, purpose-designed landlord insurance.

The rate of inflation and its associated escalation of the cost of living inevitably affects the housing market – for landlords and homeowners alike. This is reflected in recent property news headlines …

Buy to let mortgage curbs – more care demanded by Bank of England

Anticipating what it describes as a forthcoming “prolonged period of credit stress”, the Prudential Regulation Authority (PRA) of the Bank of England has urged lenders to exercise greater caution in advancing buy to let mortgage loans, according to a story in Landlord Today on the 12^th of January.

The current collection of risk factors – such as higher interest rates, inflationary pressures, and cost of living increases – present new and previously untested stresses with the market for buy to let lending, says the Bank of England. Indeed, similar pressures are also affecting loans to small businesses, unsecured personal lending, and loans advanced for the purchase of commercial property.

Nationwide HPI – December 2022

The Nationwide Building Society has released details of the principal trends in its House Price Index (HPI) as the year drew to a close. In summary, these revealed:

• a fourth consecutive month in which average house prices fell – with a recorded decline in the annual rate of growth of 2.8% in the final month of the year;

• this decline has been echoed across all regions of the UK by the time the final quarter of the year came around;

• East Anglia returned the strongest market performance and house price growth during the year while Scotland recorded the weakest;

• the gap between the strongest and weakest performing regions was the smallest since the Nationwide started to compile an HPI; and

The figures reveal that average house prices in the UK have seen their biggest decline since the financial crisis of 2008, says the report. Prices at the end of the year were some 2.5% lower than the peak that had been achieved in August 2022.

Commentators ascribed at least some of this slump in prices to a temporary caution on the part of buyers in the initial phases of the current inflationary period. Renewed market activity might be expected as the New Year progresses.

The average UK household will lose over £2,000 in income this year

Citing research from the Resolution Foundation, Landlord Zone on the 10^th of January revealed that the average family in the UK is likely to be worse off to the tune of at least £2,000 this year.

The UK is feeling the effects of some of the biggest impacts since the Second World War – the current war in Ukraine, the lingering effects of the Covid pandemic, high rates of government spending and borrowing, and the steadily increasing rate of inflation and the cost-of-living crisis that follows in its wake.

All these pressures are combining to strip an estimated £2,100 from the average family’s income in the year ahead, it says.

Government energy efficiency plans “dead in the water” warn landlords

In a press release on the 9^th of January, the National Residential Landlords Association (NRLA) takes the government to task for its failure to provide landlords in the private rented sector with clear and transparent guidance with respect to its plans for energy efficiency.

Despite appeals by landlords for the government to delay the imposition of stricter energy efficiency standards until 2028 – instead of the 2025 target set by the government – there has been no clear response to the landlords’ demands.

Any hope that the government might achieve its aim of bringing all accommodation in the private rented sector to at least a ‘C’ Energy Performance Certificate rating is doomed to failure and likely to prove “dead in the water”, says the NRLA.

Running a buy to let business these days can be a challenge. Any landlord determined to negotiate the shifting sands of the private rental market will also need to keep a close eye on legislative reforms that are afoot.

With that in mind, let’s cast an eye across the horizon of some of the changes landlords can expect in the year ahead.

Renters Reform Bill: will the reforms become clear?

The single biggest development to shape the private rental market for many years to come is the much-vaunted and long-awaited Renters Reform Bill.

The reforms are aimed at making the private rented sector “fairer” for both landlords and tenants. As the Law Society has noted the basic thrust of the reforms was first aired by the government in April 2019. Eventually, a White Paper on the subject – entitled A Fairer Private Rented Sector – was published on the 16^th of June 2022.

2023 may yet be the year when some or all of the proposed reforms are finally enacted.

Included in the raft of sweeping changes are the following highly significant moves:

• repeal of Section 21 of the Housing Act 1988 and its so-called “no-fault” evictions – which will, of course, make it more difficult for many landlords to gain repossession of their let property;

• removal of landlords’ ability to grant Assured Shorthold Tenancies (ASTs) – by far the most common type of tenancy – and replace them with Periodic Tenancies that grant tenants the right to abandon any tenancy (without paying further rent) after just giving just two months’ notice; and

• landlords will be restricted to just two rent increases each year – and tenants will be able to appeal against the increases and any other issues with an independent private rented sector ombudsman.

The housing charity Shelter – which broadly supports the reforms – adds that it will also become illegal to reject applications for tenancies from those on welfare benefits, a formal register of landlords will be created, and local authorities will be given greater powers to enforce the rights of tenants.

Clearly, enactment of the current Renters Reform Bill would alter the entire landscape for landlords throughout the UK.

Focus on energy efficiency for commercial properties

Building management specialists the BGES Group on the 22^nd of November 2022 reminded landlords that important energy efficiency measures will be extended to commercial properties during the course of 2023.

The current Minimum Energy Efficiency Standards (MEES) that apply to non-residential buildings mean that landlords cannot grant new leases to commercial tenants if the Energy Proficiency Certificate (EPC) is rated less than E – that is, if it is F or G.

With effect from the 1 of April this year, those standards will apply to every tenancy agreement and lease – including existing ones. Not only that but even more stringent standards are expected to be introduced by 2027 when the minimum rating will become C, and again by 2030 when all leased commercial buildings must achieve at least a B rating.

Scotland: New rules for landlords in 2023

Thanks to its independence across many aspects of government, legislation affecting landlords in Scotland differs from the rules binding those in the rest of the UK. As far as Scotland is concerned, therefore, there are two key dates of which landlords must be aware:

Rent freeze and ban on evictions

• in response to rocketing inflation, on the 28^th of October 2022, the Cost of Living (Tenant Protection) (Scotland) Bill 2022 came into effect;

• this introduced a ban on tenants’ evictions and a freeze on rents until at least the 31^st of March this year;

• the termination date is subject to review every three months – so the provisions may yet be extended (by up to two further intervals of six months each) until 2024;

Licensing of all short-term lets

• in October of 2022, the Scottish government introduced legislation requiring all new “hosts” or landlords of short-term lets to apply for a licence allowing them to accept paying guests or tenants;

• with effect from the 1^st of April this year, those rules will now apply to all hosts or landlords – including existing ones;

• once an existing landlord has applied for the relevant licence, they can continue to let the accommodation while the application remains under consideration – but new hosts or landlords must wait until their licence is in place before they can legally let the accommodation.

Summary

Wherever in the UK you are a landlord with a buy to let business, therefore, there are significant changes on the horizon, and you will do well to prepare for the impact and implications of these well in advance.

Disclaimer: Please note that this information is based on our current understanding of planned legislation. Until legislation is actually passed, further changes can be made. We recommend you always seek professional advice if you have any queries relating to your obligations as a landlord as well as legislation.

Some landlord insurance policies may have certain conditions attached to who you can and cannot rent your property. For example, some policies may specifically exclude cover if tenancies are granted to groups such as students, DSS recipients, asylum seekers, or others.

While this may be perfectly acceptable for some landlords, there may be others for whom it is not. You may be one of them, who may find this condition relating to tenants to be restrictive – impinging on your freedom of choice to rent your property to whomsoever you choose without the added overhead of seeking out new landlord insurance at the same time. It is your business, after all.

There is also the question of unlawful discrimination in the criteria you use for selecting your tenants. Guidance issued by the government in March 2022, for example, reminded landlords that you are breaking the law if you discriminate on any of the following grounds:

• disability;
• age;
• marriage or civil partnership;
• gender reassignment;
• sexual orientation;
• sex;
• religion or belief; or
• race

The more selective you are in the categories of tenants you allow, therefore, the more complicated the situation may become and the greater your risk in running foul of the Equality Act’s definition of discrimination.

So, you may be relieved to discover that there are some buy to let insurance providers – such as ourselves at Cover4LetProperty – who impose no such tenant restrictions and who make no such distinctions. We offer cover for DSS tenants as well as for the other categories of tenants where restrictions may also apply. This gives you the freedom to let your property to whom you want.

What does DSS tenant mean?

The acronym DSS stands for the “Department for Social Security” – a government department that was responsible for welfare benefits payments, but which hasn’t existed since the early 2000s.

A DSS tenant is someone who is in receipt of benefits like housing benefit or Universal Credit – for example, someone who is unemployed, disabled, and/or is a single parent.

Some landlords – and some insurance providers – are uncomfortable letting to tenants on low incomes, as they worry that those on benefits may fail to keep up on their rental payments or cause malicious damage. Beware, however, as the housing charity Shelter reminded landlords and tenants in a posting on the 1^st of August 2022, it is unlawful to discriminate against a tenant or potential tenant on the grounds of their disability.

Cover4LetProperty and insurance for DSS tenants

The good news is that at Cover4LetProperty, there are no restrictions on whom you let to. We cover all tenant types, including people in receipt of housing benefits, students, or any other group.

You don’t even need to let us know that you have a tenant or tenants in receipt of housing benefits or any other benefits when you get your landlord’s home insurance quote.

With our easy-to-use quote and buy online system, we will compare the market landlords’ insurance to see which solution most suits your own unique requirements. Our service is free and there is no obligation to buy the cover after you have received your quote.

If you prefer to speak to someone to get your let property insurance quote, then please feel free to telephone us on 01702 606 301. One of our friendly, professional team will be delighted to help.

What does landlord insurance for DSS tenants cover?

Our DSS landlord insurance is the same as our standard landlord insurance policy. It offers exactly the same protection – such as cover for the building against the standard risks such as fire, theft, loss, or damage, as well as add-on elements providing:

• cover for subsidence as standard – a severe problem that is not nearly as widely covered as it may once have been;
• malicious damage caused by your tenants or their visitors (claim limits apply) – perhaps not something that you may have come across before, but it does happen;
• contents insurance (if required);
• compensation for loss of rent and rental income (up to pre-set amounts) if your tenants have to move out to alternative accommodation while repairs are carried out on damage caused to your property by an insured event (fire, flooding, storms, and all those risks covered under your policy);
• trace and access cover which protects you financially in situations where you may otherwise be facing the repair costs relating to the damage that a tradesman may have caused locating and fixing another problem.

With our landlord property DSS insurance, you can feel confident that your buy to let business is protected.

DSS landlord insurance

As a busy landlord, you may wish to avoid what could be the nasty surprise of finding that your choice of tenant had invalidated your existing landlord insurance.

Opting for a policy where no such DSS tenant restrictions exist is a way of simply and easily removing something else that you need to remember.

Our DSS landlord insurance will give you peace of mind that your business is protected with what we consider to be comprehensive, cost-effective cover.

On a related matter, you might also want to put yourself fully in the picture about any need for unoccupied property cover. This is additional, standalone cover that you might need if your property is temporarily unoccupied no matter what your tenant type or whether they are in receipt of housing benefits.

You may find that typically policies will have a time limit on the number of days (typically 30-45 consecutive days depending on the policy) that your property can stand empty before your standard buy to let cover becomes invalid – and that’s when you may need to consider unoccupied property insurance.

Next steps

If you have any questions or queries relating to a new or existing policy, please do not hesitate to contact us.

A New Year, a fresh start – if only, you are probably saying to yourself!

Towards the end of 2022, we started staring inflation in the face. A recent article noted that inflation is already in double figures, and it is forecast to reach a high of 13% early in the New Year. Some analysts reckon it could rise even higher.

Meanwhile, domestic staples such as sugar, milk and teabags have soared in price – by 11.6% in October 2022 – and contribute to the steadily rising general cost of living.

As winter draws on, probably the most pressing worry for many households – whether homeowners or tenants – is the cost of keeping the place warm. Despite the government’s energy price guarantee, a story by the BBC on the 24^th of November explained that a typical household would be facing bills of an average of £3,000 – and the level of available support would be considerably reduced come next April.

Can you make savings?

Against this bleak outlook, the question on so many lips is whether savings in the domestic budget can be made – whether you own your home, are a buy to let landlord, or are renting your accommodation.

It helps no one if you are paying over the odds for the energy you need to consume to keep your home warm. For homeowners and tenants, the savings are obvious and for landlords, any cost-efficiencies in the use of energy will be welcomed by grateful tenants more likely to treat your property with the respect it deserves.

The following are some of the ways you might check whether your energy bills are currently realistic:

Your supplier and the tariff

• homeowners and landlords might want to check whether switching suppliers could achieve savings – or even whether you can switch to a different tariff from the existing supplier;

• because the energy market is currently in such a state of flux, it might be difficult to find alternatives and you may need to sit it out for a while longer until the situation becomes clearer;

Benefits and grants

Citizens Advice stresses the importance of both homeowners and tenants checking whether you are eligible for the benefits or grants that may be available if you:

• have no income or receive only a low income;

• have a disability;

• receive a State Pension or over the age for which you qualify for such a pension; or

• if you are in arrears with payments to your current energy supplier.

Citizens Advice also offers a handy ready reckoner to check your eligibility.

Energy consumption

• every household is likely to be different, of course, in the amount of energy it consumes in the normal course of events – but, in most cases, even minor changes to habits and use of energy can lead to significant savings;

• restrict the energy you use on heavy consumers such as washing machines and dryers, for example, by reducing the temperature at which you wash your clothes and by hanging the finished articles outside to dry on those often rare, sunny days;

• make sure the fridge remains set to the correct temperature – between 3º and 5º – and remember to defrost it regularly;

• simple measures such as closing interior doors, using draught excluders, and closing curtains can also help to reduce your consumption of energy;

Energy efficiency

• homeowners and landlords will have received a copy of the property’s Energy Performance Certificate (EPC) if they bought it after August 2007 and any tenancy granted after October 2008 must also provide tenants with a copy of the latest EPC;

• energy efficiency – especially within the private rented sector – has become a hot topic recently and although improvements require a degree of investment, the savings can be substantial.

Water and sewerage

According to the website Statista, the average British household will have paid £419 for the annual combined water and waste disposal or sewerage bill by the end of the financial year to the end of March 2023.

Being careful about the volume of water you consume will not only save you money but also help you and your family to live more sustainably.

It is estimated that an average household of just four people will use around 600 litres of water every day. Yet there are simple ways to reduce this volume, such as ensuring that you have no leaks through faulty pipes or fittings such as the toilet, hand basins, and sinks. Consider using a cistern displacement device (CDD) to reduce the amount of water you flush each time the toilet is used. And always keep handy the telephone number for your local plumber – so that any emergency is dealt with promptly.

Summary

Getting ready for 2023 almost inevitably involves getting ready for some tough household budgeting.

By paying careful attention to the utilities you use – electricity, gas, and water – you might make helpful inroads into your ever-escalating household bills.