As a landlord, your property (whether it be a single property, block of flats or a portfolio of rental units) is more than just brick and mortar. It’s a valuable investment that comes with its own set of responsibilities and risks. An important aspect of protecting your property and your investment is securing landlord insurance designed to provide coverage for your unique needs and any challenges that may come along the way.
In this article, we will cover what landlord insurance is, answer the question is landlord insurance mandatory, why you should get it, and what the different types of landlord insurance are.
What is landlord insurance?
Landlord insurance is a type of cover designed specifically for property owners who rent out their property. Unlike home policies, landlord insurance is tailored to meet the complex challenges faced by landlords. Rental property insurance provides a safety net to protect your property in the face of unexpected events such as damage, disruption to rental income or any tenant-related issues.
Is landlord insurance mandatory?
Landlord insurance is not legally required in the UK, but it is highly recommended; especially with a third of landlords having their property damaged by tenants within the last 12 months. If the property is bought with a mortgage, getting landlord insurance is often a requirement of your mortgage provider, but if not, you can choose whether or not to purchase it.
Why you should get landlord insurance
Choosing not to get insurance for rental properties means you’re exposing yourself to significant risks. It’s estimated that more than a million UK landlords don’t have landlord insurance. Without rental property insurance, you might be liable for the costs of repairing or even rebuilding your property in the event of loss. You may also be held responsible for compensating third parties for injuries or damages caused by the property.
What is the difference between landlord insurance and home insurance?
If you’re renting out your property, you will need to invest in landlord insurance, not home insurance. Home insurance policies exclude or limit coverage for rental properties as there is an increased risk associated with the unique challenges that come along with property management. Relying on home insurance without letting your insurer know of your rental activities could lead to claims being denied.
Types of landlord insurance
Every landlord has different needs, and the kind of rental property insurance you choose may vary depending on the type of tenants you have or the location of your property. There are several different landlord insurance policies available to choose from depending on your specific needs:
- Buildings insurance: This type of insurance covers the structure of your rental property. It protects you against structural damage from things such as fires or damage from weather.
- Contents insurance: This covers the furnishings that landlords provide for tenants’ use, such as carpets, curtains, or furniture.
- Landlord liability insurance: If a third party suffers any injury or property damage due to your property, landlord liability insurance provides financial protection under these circumstances.
- Loss of income insurance: This cover ensures that you still receive rental income even if your property becomes uninhabitable due to a covered event.
Optional additional coverage
Many landlord insurance policies offer additional coverage options that are tailored to your specific needs. These add-ons can provide further peace of mind and protection:
- Accidental damage by tenants: This covers sudden and unintentional damage that tenants have made. This includes, broken windows, damage to fitted carpets and mishaps involving children.
- Malicious damage by tenants: Provides coverage for intentional damage caused by tenants. Examples of intentional damage include cigarette burns on furniture and broken windows.
- Unoccupied property cover: If your property is unoccupied for a long period (this could be due to renovations or between tenants), this type of coverage offers protection during this time.
How Aspire to Move can help
Investing in landlord insurance is a wise decision for landlords, to provide peace of mind while covering the risks involved with letting your property. At Aspire to Move, we offer specialised landlord services to landlords, including our tailored advice with a personal touch.
We have years of experience in helping landlords with all aspects of the letting process and are dedicated to excellent service. Get in contact with us today to see how we can help you.
