Landlord Insurance 1st Aug 2017
Landlords need specific insurance for rental properties, which includes protection for both buildings and contents. Landlords also need extra cover for things like:
- Non payment of rent
- Tenant damage to a property
- Loss of earnings / rehousing costs if tenants need to move out following an insured event
- Liability for accidents in your property that lead to injury
Whilst most tenancies run smoothly with the majority of tenants looking after rental properties well, every now and then a less respectful tenancy may happen. Although insurers generally receive more accidental damage claims, they have seen a marked rise in Theft & Malicious Damage by Tenant claims in recent years. This may be down to landlords realising their policy covers this sort of thing, along with the increase in the rental population. Research (Simply Business) revealed that 40% of landlords said the worst thing for a tenant to leave behind is damage to the property.
Malicious damage is often more extensive than accidental damage and may be spread over a number of rooms. Furthermore, in addition to paying out large sums to put the damage right, landlords are likely to experience loss of rental income during this time. It is therefore essential that your landlords’ insurance package covers these things. Not all insurers provide cover for Theft & Malicious Damage by Tenant, or in some cases a hefty additional premium will be charged. Landlords should be aware of this when looking at different packages.
In addition, landlords should look at ways of minimising the risk of damage happening in the first place. Measures include:
- Tenants should be fully reference checked.
- A full deposit should be taken and lodged with the tenancy deposit scheme.
- Tenancy agreements must be in place outlining, amongst other things, the expectations and requirements of the landlord.
- A detailed inventory should be provided, supported by photographic evidence detailing the condition of the property (internally and externally) at the start of every tenancy.
- Regular inspections should be carried out.
A reputable letting agent such as The Key Place will deal with the above on behalf of fully managed landlords.
The Key Place offers a comprehensive insurance package, provided by Bruce Stevenson, to all of our fully managed landlords. See accompanying newsletter article for further information. We will also manage the insurance claim and associated repairs as part of the package. If landlords do not take our insurance then they will have to manage the claim themselves, or The Key Place can manage the claim for a fee. Contact us for further information.