With buy to let mortgage repayments to meet, not to mention your search for reliable tenants who are going to pay their rent on time, you might not be putting insurance at the top of the list of actions you need to take.
It is a safeguard you may be overlooking at your peril:
- calamities such as fire, floods and impacts may cause severe damage to the structure and fabric of your let property (to the point even that it needs to be totally re-built);
- your contents of the let property may also be vulnerable to loss or damage – not least as a result of accidental or malicious damage by your tenants;
- claims against your liabilities as the property owner might run into the hundreds of thousands of pounds;
- a significant amount of rent may be lost if you are temporarily unable to let the property because of damage caused by one of the insured events; and
- legal expenses might quickly mount up if you need to challenge insurance claims or defend your property against other action in some way.
No ordinary home owner
Even this short list of potential perils suggests one of the key features of insurance for landlords – it is qualitatively different from the insurance arranged by owner occupiers. Certainly, there may be some similarity in the fact that each type of insurance offers protection for the physical structure of the property, and of its owner’s contents, but the similarity ends more or less there.
The owner occupier, of course, is intent on insuring the home in which he or she lives. The landlord is insuring a let property owned as a business.
According to the Telegraph newspaper (April 2015), there are some 2 million such landlords in business in Britain at the moment – and their economic contribution is probably not given the political support it deserves, says the paper’s correspondent.
The business use of the let property is a critical aspect of its insurance. The risks faced when you are running a business and your property if occupied by tenants are of a quite different nature and order compared to those when it is your own residence and you are living there yourself.
The difference is critical because it affects the risk taken on by your insurer. Where the risks are those of a let property and you have tenants in occupation, for instance, standard home building and contents insurance as might be arranged by an owner occupier is inappropriate and if this is the cover on which you are relying any claim may be turned down by your insurer.
Where can I buy it?
It may be apparent, therefore, that landlord insurance is something of a specialist, niche product. For such a product, it may be sensible to look to an experienced, specialist insurance provider – such as us here at Cover4LetProperty – to secure the particular cover you require as a landlord.
Whilst it is simple and straight forward to arrange for an insurance quote online, insurance for landlords frequently needs to be tailored to the specific circumstances of the individual landlord. In that case, you might want to give us a call on our direct, dedicated helpline – which is completely free of any of the annoyances you might encounter when using a call centre.
With particular aspects of the cover tailored to suit your specific needs, the insurance then typically provides protection for the physical structure and fabric of your let property, any contents within it that you own (if you have elected for landlords’ contents cover), indemnity against claims arising from your liabilities as a landlord or property owner, and compensation (up to prescribed limits) for any loss of rental income following an insured event.