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Landlords Legal Protection Insurance

As a responsible landlord, you make every effort to maintain a smooth, civil, and professional relationship with your tenants.

With the best will in the world – and untold effort – however, there may be times when you have little option but to seek legal redress in resolving some dispute with your tenants – or, indeed, defending your own actions as a landlord in some legal action pursued by your tenant.

Pursuing or defending any legal action may prove expensive – and those involving the relationship between landlord and tenant are no exception.

Legal protection insurance

So that you are prepared and adequately indemnified against such costs, you might want to consider legal protection insurance. It will help you meet the cost of bringing or defending civil action to protect your interests in a let residential property situated in England or Wales.

The benefits covered by legal protection insurance, of course, vary from one provider to another but policies arranged by us here at Cover4LetProperty include:

  • cover for legal costs and expenses in the pursuit or defence of civil disputes relating to your let property;
  • the loss of salary or wages incurred for the time off work to attend any court or tribunal hearing as a witness or defendant (up to £100 per person per day, maximum £1,000 per claim);
  • legal costs incurred to use your legal rights to evict anyone, other than tenants who have your permission to be in the property;
  • a 24-hour Helpline, so you know we are always at the end of the phone if you need help;
  • legal cover costs up to £50,000 per incident;
  • insurance for all tenant types; and
  • insurance for both long-term tenancies as well as those on a minimum 6-month agreement.

The premiums for legal protection insurance are calculated on the basis of each tenancy agreement you make – and not based on the physical address of your let property.

Legal protection insurance and the recovery of rent arrears

The basis for many disputes between a landlord and his or her tenants revolves around the non-payment or build-up of rent arrears.

It is important to recognise that legal protection insurance does not, in itself, cover the amount of any rent arrears owed by your tenant – but it can help in covering the legal costs associated with recovering those arrears. Let’s see how that might work when allied with the related, standalone cover of rent guarantee insurance.

Rent arrears are the bane of every landlord’s life – they eat away at your income, and the cost of recovering those arrears is expensive both in terms of the legal expenses likely to be involved in any eviction and the time you spend in pursuing such action.

Legal protection and rent guarantee insurance cover are the twin elements designed to safeguard you against such losses in two main ways – just as the description suggests, by providing cover for the legal expenses involved attempting to recover rental arrears when evicting tenants and compensation for any lost rental income.

Our rent guarantee insurance includes cover for landlords legal expenses as standard.

Legal protection

  • when you have tried everything in your powers to persuade your tenant to come to some sort of arrangement over his or her rent arrears – by agreeing a payment plan, for example, by paying any housing benefit they may receive directly to you, or by calling in a guarantor upon whom the tenant may have relied – legal action may be necessary;
  • if you have reached the end of the fixed term of an assured shorthold tenancy (the most common form of tenancy agreement), you may issue a section 8 notice for repossession of the let property – you will need to go to court in pursuit of the eviction and give reasons (the arrears of rent, for example) for your application to evict;
  • at any other time, you may issue a section 21 notice to the tenant to quit – typically, you will not need to attend court and do not need to give any reasons for your notice of repossession;
  • a section 8 or a section 21 notice to quit, however, is designed to secure your possession of the property and not necessarily any recovery of rental arrears – although these may be awarded (but might not be) during any court hearing of your section 8 notice;
  • landlords’ legal protection insurance covers the expenses and costs involved in pursuing any civil dispute with your tenant or defending any claim that may have been made against you as the landlord – in other words, and as we have already noted, it covers much more than just notices to quit, evictions or attempts to recover rental arrears;

Rent guarantee insurance

  • rent guarantee insurance includes legal protection insurance as standard;
  • rent guarantee insurance policies we arrange cover any loss of rent you may have suffered, up to £1,500 a month, for a maximum of six months or until you have secured vacant possession of your let property (whichever is the sooner);
  • the cover also provides up to a total of £50,000 in legal costs and expenses involved in the eviction of a tenant, in accordance with the relevant tenancy legislation;
  • these legal costs and expenses include up to £100 a day for any witness or defendant who has had to lose wages or their salary by taking time off work to attend a tribunal or court hearing in connection with your attempts to recover arrears of rent;
  • our rent guarantee insurance may be arranged for any type of tenant you may have – professional, employed, self-employed, unemployed, benefits claimants or others;
  • the cover may apply whether you have entered into a long-term tenancy agreement with your tenants or have just the minimum six-month tenancy agreement;
  • since we maintain our helpline 24/7, you may rest assured that help is just a telephone call away whenever you need it.

Your responsibility

As a responsible landlord, you have a duty to take every reasonable precaution in the selection of tenants to avoid both arrears of rent and the legal costs involved in recovering those arrears.

It is a condition of such insurance policies, therefore, that you secure one approved credit reference agency report and at least one adequate character reference in writing for each of your tenants. So, make sure to build in the necessary steps each time you take on a new tenant so your rent guarantee and legal protection insurance will pay out in the event it needs to.

The excess incorporated into our rent guarantee insurance is the equivalent in value to one month’s rent on each claim you make under your policy.

Frequently asked questions (FAQs)

In anticipation of just some of the queries you may have about legal protection insurance, here are some of the most frequently asked questions (FAQs) we receive on the subject.

Why buy landlords legal expenses insurance?

If you have a dispute with one of your tenants (for missed payments or damage for example) the cost, time, and effort of pursuing any legal action against them would probably result in a financial loss to you – as well as being very time-consuming.

Landlords legal expenses insurance will provide you with security and peace of mind. So, if you need to take legal action against a tenant for eviction, repossession, damage, or whatever, then your legal costs will be covered (up to the limits outlined above).

What does landlords’ legal expenses insurance cover?

In a nutshell – and as we have seen – the insurance assists with the cost of legal expenses relating to proceedings you take against a tenant.

For example, your tenant misses several rent payments. You serve them notice seeking possession and begin court proceedings to get a possession order.

Your legal expenses insurance will cover (up to set limits) the cost of legal help to put your claim together and legal representation at the hearing. It will also include (again, up to set limits) loss of salary or wages incurred for the time off work to attend any court or tribunal hearing as a witness or defendant.

How do I get a quote for landlords’ legal expenses insurance?

You can buy this insurance as a standalone product or add it on to your landlord’s insurance. To find out more about landlords legal protection insurance and enjoy the peace of mind it offers – or to get a quote – please ‘phone us on 01702 606301. We’d be delighted to help.

How do I reduce the risk of problem tenants?

Of course, you want the best possible tenants for your property, and so it makes sense to take pre-emptive steps before they move in. This can include tenant referencing, drawing up an inventory (with photos of the high-value items such as furnishings in case there are disputes are damage) and having a watertight tenancy agreement.

Backing this up with the most suitable landlord insurance and legal expenses insurance can help provide you peace of mind that your asset and your business is properly protected.

Why choose Cover4LetProperty for landlords’ legal expenses insurance?

At Cover4LetProperty, we are a long-established insurance company authorised and regulated by the Financial Conduct Authority (FCA) and registered in England and Wales. We strive to offer only first-class products backed up with first-class customer service. You can get an insurance quote online anytime. Or, if you prefer to speak to us, one of our professional, dedicated team will be pleased to help you.

We are consistently rated 4 and 5 stars for our customer service by Feefo, the independent ratings website. We have also been awarded the Gold Trusted Service Award by Feefo!