22 Aug

Landlords insurance: What you need to know

Landlords insurance: What you need to know

Individuals considering purchasing a buy-to-let property and becoming a landlord for the first time will have many factors to consider, from filling out paperwork to selecting the right tenants.

Insurance is arguably one of the most important elements landlords need to think about when letting a property, but for those who are new to the game, this can be somewhat confusing, as it differs significantly to general home insurance.

Therefore, we've put this guide together to help first-time landlords to understand exactly what they need to be covered against when renting out a home.

Why is landlords insurance needed?

Landlords insurance may also be referred to as buy-to-let cover and is essential for those renting out a property to ensure they can make a claim for financial support towards any damage to the house.

Failure to have an adequate cover policy in place means landlords will not necessarily be able to receive any help towards the cost of repairs in the event of damage, leaving them out of pocket and no longer in the position to continue renting out the property.

What types of cover are available? 

In light of this, it is important that landlords know what types of insurance they can invest in.

Landlords buildings insurance will ensure they are protected financially for any damage to the actual structure of a property, whether that be caused by unruly tenants or more natural causes, such as the weather.

Contents insurance looks after the items inside the house, from appliances to furniture, meaning if these need replacing, the landlord should be able to make a claim with their cover provider for financial support towards this.

Landlords liability is another type of insurance many invest in, as it covers them from having to pay out if a tenant dies or is seriously injured while in the let property.

Loss of rent insurance is another sensible type of cover to take out, with this ensuring landlords are not left out of pocket in the event of the property being unoccupiable for a period due to extensive damage. 

However, it is important to remember that many landlords insurance policies do not cover them for the cost of replacing items following a theft, only doing so in cases where violent force has been used to take goods.

Taking out cover

Depending on the insurance provider, the way in which landlords insurance is sold could differ significantly, so it is important that individuals shop around for the best possible deal for them, while also bearing in mind that types of cover may be sold as part of one single policy, or separately.

Landlords should always check excess charges on a policy before taking it out, as these can vary significantly and if particularly high, may result in the property owner receiving only a small sum from their insurer when a claim is made.

In addition, it is vital to read all insurance documents thoroughly - including any small print - to make sure there are no loopholes in there and to ensure the landlord fully understands all of the information it contains, ready to pass this on to their tenants.ADNFCR-1222-ID-801744104-ADNFCR

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