When you are looking for let property insurance, the one thing you will not find in short supply is choice – there are so many products on the market.
So, how do you go about finding cover that is suitable for your individual situation?
Here are a few ideas that you may find helpful.
Why a careful comparison is essential
If you are a landlord, or soon to become one, insurance for your investment and for your buy to let business is likely to take on a priority.
Because you give it top priority, yet find that there are so many buy to let insurance products to choose from, it is essential to conduct a thorough landlord insurance comparison too. Here are the main reasons why you may want to do that:
- you may have a good idea about the kind of cover you need – to safeguard the physical property and aspects of the business you are running – but there may be items you have overlooked or simply not thought about what a comparison might reveal;
- you might already have a particular insurer or a particular product in mind – or find yourself simply renewing the same policy year after year – but only a proper comparison exercise is likely to identify all of the insurers and all of the many different products that might suit your needs and circumstances; and then
- there is the question of cost – are you paying more than the market rate, or do you already have a good deal? Your buy to let insurance comparison may hold the answer.
How to go about making your comparisons
You may have identified some very good reasons for carrying out an insurance comparison – but going about it might be another matter altogether.
It is the kind of research you might be able to carry out yourself, for example. Shopping around might help you spot the best buys, serve as a reminder for elements of cover you might have been overlooking so far, or identify products on the market you otherwise did not know about.
With so much at stake in the size of your investment in a buy to let business and the consequences of getting the insurance all wrong, you might want to consult experts in the provision of insurance for landlords and take advantage of their experience in making insurance comparisons on your behalf.
At Cover4LetProperty, we pride ourselves in having done just that since the founding of our business in 1946.
What are you looking for when you compare buy to let property insurance?
Although your aim is to compare like with like, there are subtle – and sometimes not so subtle – differences between policies. So, you might be looking at some of the following:
- at the heart of the typical landlord insurance policy is protection of the physical structure and fabric of the buy to let property;
- although most policies are likely to cover major risks such as fire, flooding, storm damage, impacts from falling objects and so on, the exclusions – subsidence for example is not included as standard on some other providers’ policies – may be something you want to take into account;
- when it comes to the building, the total sum insured needs to be enough to cover the possible requirement for completely clearing the site and rebuilding the premises in the event of a major insured incident;
- some policies also include in their standard provisions cover which is absent from others – a case in point might be the risk of malicious damage carried out by your tenants;
- whether you have fully furnished the let accommodation or have items you own mainly in the common areas, you might want to consider the contents insurance cover of your policy – and whether claims for theft, loss or damage are settled on a new for old basis or after the deduction of an allowance for wear and tear;
- because it is a business you are running, you are likely to want some form of protection against the loss of rental income if a major insured incident leaves the premises temporarily unfit for habitation – although many landlord insurance policies may offer compensation for such a loss, the maximum amounts payable may differ;
- a potentially critical component of your buy to let insurance is indemnity for claims alleging your negligence as the property owner or landlord – such claims from tenants, their visitors or members of the public may be substantial, so you might want to compare whether any given policy offers cover up to, say, £1 million, £2 million or more.
Some let properties insurance providers may also provide other benefits such as offering certain paid-for categories of legal expenses cover should they arise from one of the insured risks.
However, each individual policy will typically have its own limits, exclusions and conditions.
Conducting a comparison of available insurances for your buy to let property may seem the obvious thing to do, therefore, an effective and successful exercise may prove more difficult than it first appears – a time to call in the professional insurance providers.
How price comes into the equation
It is possible to compare let property insurance on a number of levels but perhaps the most conventional is cost.
Looking directly at the ticket price of any let property insurance is perfectly natural but it may also offer the greatest chance of distraction.
In reality, the price may not, in itself, tell you much about the policy. To really compare let property insurance, it’s necessary to look at what you’re getting for your money – i.e. the cover itself.
The government sponsored Money Advice Service offers a reminder that the cheapest insurance policy is not usually the one that covers all of your needs, so refining just what those needs might be and the ability of the market to meet them might be a matter on which to consult an independent insurance broker.
Certainly, the price will always be a factor if you are going to compare let property insurance but keeping that in perspective against things such as the cover, may be advisable. Only in that fashion are you likely to be able to decide what is going to give you the protection you need while keeping an eye on cost-effectiveness.
Alternatively, if you need any assistance with choosing or comparing your landlord’s insurance cover, or you’d just rather talk to a ‘live’ person in order to get a let property insurance quote then please feel free to get in touch, either via email or the telephone. We are always happy to help!
Remember unoccupied property insurance
It’s perhaps not always widely known that property insurance, including owner-occupier home buildings and contents insurance, and landlords’ insurance, typically contains special clauses relating to unoccupied property.
If your property is unoccupied for typically more than 30-45 consecutive days (depending on the insurer), you may find that your property insurance becomes invalid unless you have taken out unoccupied property insurance in advance.
It is something that may happen a little more easily than some would suspect – for example during property redecoration or if you are unlucky and have extensive gaps between lettings.
Making the decision
In the end, only you can make the decision as to which let property insurance is the most appropriate one for you.
Comparing the details of the cover provided as well as the conditions and exclusions should enable you to reach a decision – and it’s worth thinking, too, about some of the broader issues, such as:
- think about your specific business situation both in terms of the position today and how it might evolve in future – today, for example, perhaps you are letting exclusively to professionals but might in future consider moving into the student letting marketplace;
Look for options
- you might start to think about looking around in the marketplace for let property insurance policies that provide cover against both present and future risks;
- that exercise might prove to be a little time consuming and you may save time by going to a specialist broker – such as ourselves – who might be able to provide landlord insurance advice based on their knowledge of a number of insurance providers;
Think about discounts
- although it may not be unusual for an insurance provider to offer discounts in certain circumstances, some may be rather more prolific in doing so than others;
- if you are keen to manage your costs downwards, looking for these opportunities might be important – you might see them in areas such as taking increased voluntary excesses or using enhanced security measures around your property etc;
Compare your options
- taking the time to look at a number of possibilities side-by-side is important if you are to be sure that you have a degree of confidence that the policy you are about to choose is a good deal when all factors are considered.
At Cover4LetProperty we would be only too pleased to assist you in your search for appropriate cover and to explain anything in the above that is less than totally clear.