Why Landlords Need Special Insurance
Why insure your rental property?
This seems like an obvious question, as we all have home insurance. But for rental property, you are incurring more risks than just simple loss of buildings and property through fire, theft and the like. Tenants pose a great many issues, and you can obtain specialist insurance to cover most of the problems you are likely to encounter.
What makes rental property different?
Most tenants are perfectly law abiding and respectable. Some are not. So you need insurance against theft of your fixtures and fittings, and damage of both fixtures and fittings and buildings. There's also the issue of public liability. As a landlord, you have a duty of care to your tenants. Although of course you will conscientiously follow the safety regulations for letting property, there is always the unforeseen to take into consideration. For example, imagine a tenant is injured when a slate blows off your rental property roof in a gale. That would probably be be your responsibility, and you need Public Liability Insurance to cover this kind of occurrence.
Insurance to protect your income
Supposing your rental property is your main or only source of income. Perhaps you have four converted flats in a Victorian house. If it burned to the ground, your insurance would cover the rebuilding costs, but what about the loss of income, which conceivably could last for months or even years? You might even find yourself liable for providing alternative accommodation for your tenants too. So Loss of Income and Alternative Accommodation insurance is a must for the landlord.
Who put that there, there?
Imagine turning up at your property one day to find that the tenants have torn off the roof and built an extra terrestrial spacecraft observation post there instead. OK, that's a fun example, but it's not uncommon for tenants to take it into their head to knock down a wall or two. The tenant may be unable or unwilling to pay the costs of restitution, so you need to make sure that you have Unauthorised Alteration Insurance.
Where can I get help and advice?
There are many sources of advice as to what kind of insurance you should carry as a landlord. Landlords' associations, Citizen's Advice Bureaus, local Councils, mortgage lenders and of course insurance brokers themselves can all help. It's wise to seek out a specialist insurance broker who is used to dealing with landlord and tenant insurance. There are many reputable firms to choose from which can easily be found online.
