Dec 03

What Other Landlord Insurance Policies Should I Procure?

Landlords understand that they need insurance to properly protect their investment. The one insurance that all landlords must have is landlord insurance. This is a general term that describes a rather complex policy that covers the building, liability and various other aspects of the property. Without landlord insurance, a landlord can lose their entire property with no means of financial recourse.

Additional Insurance Options

There are a variety of insurance options that you will be able to take out. Among these options are the following:

Unoccupied Property Insurance

This is insurance that is ideal for a landlord that frequently switches tenants. If renovations are needed or you need to find a new tenant, you will be very unhappy if you do not have unoccupied property insurance.

What this insurance allows is for you, the landlord, to recuperate some of the losses that would be present if the property were unoccupied.

This insurance will often last for 30 – 45 days before the payouts decrease significantly. Some policies will also end immediately after 45 days. The goal is to have some financial relief if a tenant leaves or if repairs need to be made and the property cannot be occupied.

Emergency Insurance

This insurance is often only supplied by utility companies. For instance, your gas provider may provide emergency insurance as part of your service, or as an add-on. What this does is allow you to call the service provider when an emergency has arose.

As an example, if a tenant calls you in the middle of the night about the boiler not working, you can call British Gas, or your provider, and they will come out and offer assistance. The best part is that the tenant can call the company, allowing for you to not have to deal with late night calls.

Renovation Insurance

The perfect insurance for when a property is being renovated. Renovation insurance will cover structural and non-structural work that is being done to a property. Furthermore, this insurance may also offer liability cover in the event that a renovation led to an injury on the property. Theft and fire insurance are also often included and will allow you peace of mind when renovating a property.

This insurance may be included or added to your policy, or it may be procured prior to any renovations taking place.

Alternative Accommodation

A cover that may or may not be included in your basic landlord insurance policy. This will allow you to offer your tenants accommodation in the event that your property is currently uninhabitable. If a fire was to occur, a home would not be able to maintain occupancy during the repair process. Depending on the extent of the damage, this may mean that a tenant is without a residence for an extended period of time.

As a landlord, you can offer these alternative accommodations as a part of your rental agreement.

Obtaining and renting the property may also be covered under this insurance option, allowing for a steady stream of income until your damaged property is repaired.

Evaluating Your Policy

Before contacting any insurance providers, it’s essential to evaluate your landlord insurance policy to see what inclusions may already exist. Furthermore, you will want to check over any exclusions to see what exactly isn’t covered under your policy.

Ideally, you will be able to talk with your insurance agent to see what is and isn’t covered. An agent will also be able to further assist you by suggesting pertinent additions that may provide you with the utmost in cover.

If your policy does offer cover, ensure that the premiums are sufficient. Oftentimes, minimal cover can be enhanced to provide overall better coverage at a very minute cost.

Getting the Best Deal

Getting the best deal for your insurance is easy. You will want to consult with your current landlord insurance provider to see what they currently offer. As a current client, you may be able to bundle a few of the policies together to save money. Furthermore, if you have multiple properties, you will often be able to receive steep discounts.

Speaking with your insurance agent is the best option available. In the worst case scenario, your provider will not offer the required insurance and you will need to seek additional cover from another provider.

Dec 02

5 Helpful Tips for New Landlords

No matter whether you’ve just purchased a rental property for investment purposes or recently decided to let out your family home, you probably have a number of questions and concerns as a new landlord. Letting your property is not a decision that should be taken lightly, and many new landlords struggle to navigate their way through the process of renting their homes. Here are five tips to help make your transition to landlord a smooth one.

  1. Notify Your Mortgage Lender

Did you purchase property with the intention of letting? If so, you probably already have a buy to let mortgage, or your lender is aware of your intentions.

However, if you were the owner occupier of the home when you took out the mortgage and are now planning on letting the property, you will need to inform your lender right away. Depending on your lender, you may be required to switch to a buy to let mortgage.

  1. Purchase Landlord Insurance

As a landlord, you may be under the assumption that your home insurance will protect your property, but in most cases, standard home insurance will not cover property that’s let to tenants. Special landlord insurance is required to provide you with the vital protection you need.

A standard landlord insurance policy will cover:

  • Buildings – This protects the structure itself and will cover damage or losses in case of a fire, flood, storm, subsidence or other natural disaster.
  • Contents – This pertains to any items in the home that you, as the landlord, own. Contents may include furniture you provide, flooring and fixtures.
  • Landlord liability – This covers any third-party claims brought against you. Should someone become injured on your property, you will be held liable for any damages awarded from a personal injury claim.
  • Loss of rent – If your property is damaged or destroyed and becomes uninhabitable, loss of rent will cover any rental income you may have lost as a result. This will ensure that you can continue making mortgage payments as usual.
  • Alternative accommodation – This will cover the cost of relocating your tenants should your property become uninhabitable.

There are also additional policies that you can purchase to cover other issues or incidents. One supplemental policy that many landlords purchase is rent guarantee, which covers lost rent if your tenants refuse to pay.

Some insurers will also include accidental and malicious damage cover in their basic policy. This will cover any damages or losses caused by tenants either unintentionally or on purpose.

  1. Consider Hiring a Professional to Find Reliable Tenants

In order to make your investment worthwhile, you need to find tenants who are reliable and responsible. This can be a tricky task, and screening potential tenants can be time consuming.

A professional lettings agent will take care of this for you. A lettings agent will not only market your property, but also vet potential tenants to ensure they meet your standards.

In some cases, and for an additional fee, agents will manage your property for you.

If you do decide to find tenants yourself, make sure that you perform a thorough reference check on each tenant’s background.

  1. Make Sure That Your Property is Appealing

What type of tenants are you hoping to let to? It’s important to understand the needs and demands of these tenants to ensure that your property is appealing to them.

Students, for example, will look for properties that offer high-speed internet connection and are close to the university or nightlife hotspots.

  1. Ensure that You Have a Proper Tenancy Agreement

Some new landlords are tempted to simply let their property to friends or family without an agreement in hopes that everything will go well. Unfortunately, without a proper tenancy agreement, you have no recourse as a landlord to recoup money for damages or unpaid rent.

Assured shorthold tenancy agreements are standard for landlords. Make sure that your agreement is for at least six months and will guarantee that your property will be returned to you at the end of the agreement.

While standard agreements will help protect both you and the tenant, it’s also important to customise your agreement. For instance, if your property includes a garden, you may want to include a clause in the agreement that states that tenants are responsible for the garden’s upkeep. These clauses will help ensure that your property is well-kempt by your tenants.

Dec 01

Do You Need Landlord Insurance?

If you’re currently letting your property or considering letting in the future, you may be wondering if you really need landlord insurance. Landlords face many risks when renting their property to tenants, so it’s important to get all of the facts before making such an important decision. First, let’s discuss what landlord insurance is.

What is Landlord’s Insurance?

Landlord Insurance, as you may have guessed, is designed for landlords. It offers unique cover to protect landlords against common risks they face on a daily basis.

A typical landlord insurance policy will include similar cover to what a home insurance policy would offer, but also includes additional cover that is unique to landlords.

What the Policy Covers

Policies offered by reputable insurers will generally offer the following cover:

  • Building. This protects the structure itself should a fire, flood or subsidence cause damage or losses. Not only will the cost of repairs be covered, but rebuilding costs as well. Many insurance companies are now offering unlimited cover, but not all do. For this reason, it’s important to assess the value of your property to ensure that you’re purchasing adequate cover should you need to rebuild.
  • Contents. Contents insurance is essential cover, particularly if your property is furnished. This will protect any contents that you, as the landlord, own, such as TVs, carpet, sofas, beds and any other items that you provide your tenants with. Please note that this cover will not protect your tenant’s belongings. They will have to purchase their own contents insurance to receive this protection.
  • Loss of Rent. Accidental damage or a natural disaster may destroy your property and cause it to become unlivable. If your property becomes uninhabitable, loss of rent will provide you with compensation for lost rent. If you have a mortgage on your property, this cover becomes particularly important. Without it, you may struggle to make your mortgage payments on time. Loss of rent may also cover legal costs associated with evicting squatters, tenant disputes, property repossession and tenant-related other incidents.
  • Landlord liability. If someone is injured while on your property, you may be held liable for damages awarded to the injured person. With personal injury claims on the rise, it’s increasingly important for landlords to obtain this cover. Claims can often be substantial, soaring as high as £100,000 or more. Although cover ranges from one insurer to the next, most will offer standard cover up to £2 million.
  • Alternative accommodation. If your property becomes uninhabitable, alternative accommodation will cover the cost of relocating your tenants. Most insurers include this cover with their policy, but some will not. Instead, it may be offered as an optional cover that requires an additional fee.

The majority of landlord insurance policies will offer the above-mentioned cover. However, you can also purchase supplemental cover to ensure your property is fully protected.

Additional cover may include:

  • Home emergency repairs – Provides your tenants with access to emergency maintenance assistance. This assistance is available 24 hours a day, 365 days a week.
  • Rent guarantee – Protects you against tenants who refuse to pay their rent. This policy will cover lost rent and may include cover for legal fees should you be forced to evict your tenants.

Other policies may also be offered. Check with your insurer to find out what additional cover they offer.

Is Landlord Insurance Necessary?

Many landlords refuse to purchase landlord insurance because they feel it’s an unnecessary expense, but that could not be further from the truth. Unless you have deep pockets, this type of insurance is a necessity.

No matter how well you vet your tenants or how responsible they are, accidents can and do happen. Landlord insurance may not be required, but it’s certainly recommended. If you have a buy-to-let mortgage, landlord insurance may be a requirement.

What if your tenant accidentally spills red wine on your carpet? What if they forget to lock the doors, and burglars trash the property? What if they accidentally leave the tap on and flood the home? There are numerous scenarios that could leave you, as the landlord, out of pocket without the right cover.

Even if your tenants are not malicious, it’s impossible to predict the future and avoid accidents. The best thing you can do is prepare for them. That’s exactly what landlord insurance does.

The experts at iInsure365 have more advice on landlord insurance.

Nov 28

What Does Landlord Insurance Cover?

Being a landlord, you need to ensure that you have the proper cover for your investment. The very basic insurance that every landlord must hold is landlord insurance. But, what does this insurance actually cover? For a new landlord, there will be numerous cover options that provide more than adequate protection.

Basic Cover

Depending on the policy, there will be varying cover options. The following are rather standard:

Building Insurance

In the event that your building burns down or is flooded, building insurance will be the means of recuperating your loss. Under this insurance, a building will be rebuilt or repaired as necessary to the previous state when a policy was signed.

Many insurers are providing unlimited cover or cover that spans into the millions to allow for rebuilding. This allows the policyholder to not worry about rebuild estimates.

Contents Insurance

Ideal for anyone letting furnished properties. The content within your rental will have value. If you let furnished properties, contents insurance will provide the vital cover needed to ensure your property is covered in the event of theft or damage.

A few of the most pertinent items that will be covered are:

  • Beds
  • Sofas
  • Televisions
  • Appliances
  • Carpets

If any of these items are stolen by a tenant, you’ll be able to contact your insurer and make a claim. Typically, a “new for old” basis is followed. Essentially, if your old television is stolen or damaged, the insurer will provide a new model. Since finding an old model will likely be fruitless, this allows owners peace of mind.

It must be noted that contents insurance is not provided for the tenant. The responsibility of procuring contents insurance is that of the tenant and not the landlord.

Loss of Rent

Quickly being added to most insurance policies, loss of rent cover protects landlords in the event that their building becomes damaged or destroyed. During this time, a tenant would not be providing the substantial income that the landlord would need to be able to pay their debts.

Loss of rent insurance will provide monetary relief during this time.

Landlords that do not fully own a property and have a mortgage will want to ensure that adequate loss of rent is provided. These will be monthly payments, often a percentage of the rent lost, that will be provided to the landlord. Now, instead of losing the property for lack of payment, the landlord will be able to pay their mortgage and keep their investment until it is legally able to be let again.

Liability Insurance

As a landlord, there is the potential that liability claims will be made against you. Let’s take a look at a quick example of how this works:

  • A tenant is walking in the backyard and trips over a broken pipe.
  • A lawyer alerts the tenant that the landlord should have made proper repairs.
  • The tenant sues you based on personal injury.

You’re responsible for keeping your property safe, but if you don’t know that a problem exists, you may still be sued. In this case, you would be personally liable for the claims made against you. With many cases reaching over £100,000, it’s essential that liability cover be provided.

Liability cover will reach a minimum of £2 million as a standard. This is a necessity.

Legal Expense

The perfect addition to liability insurance. Legal expenses that are accrued due to liability claims, evictions, repossessions or other legal issues dealing with a tenant will be covered. Legal expenses can be costly, and without this cover, it may be difficult to evict a tenant or acquire legal representation.

While many policies will have all of the above cover options, there will be some that do not. It’s important to discuss your landlord insurance options with an insurer prior to signing a policy. Oftentimes, you will have a lot of extra cover options that can be added to further protect your investment.

Many insurers will also offer bundle options that will have varying levels of cover added.

When working with the same insurer and insuring multiple properties, you may be able to seek a policy that covers multiple units for a low cost. This is the optimal choice when renting a block of flats.

Nov 27

What Is Blocks Of Flats Insurance?

Blocks of flats insurance, sometimes referred to as block insurance, is a type of insurance policy that covers a variety of property types, including purpose built blocks of flat and houses that have been converted to flats. Freeholders, property management companies and leaseholders can purchase this type of policy to ensure that the property is covered.

Is Blocks of Flats Insurance Necessary?

No matter whether you’re a resident, own or manage a block of flats, block insurance is necessary. A typical buildings insurance policy may not provide the level of cover you need to ensure that your property is completely protected.

What Block Insurance Covers

Block insurance offers comprehensive cover to ensure that blocks of flats are protected. Cover includes:

Damage or Loss Caused By Storm, Fire, Escape of Water, Flood and Subsidence

If the flats are damaged or destroyed by a storm, fire, flood, block of flats insurance will cover the cost of repairs or the cost to rebuild.

A policy may cover the following:

  • The building itself
  • Garages, roads, pathways and car parks
  • Contents in communal areas
  • Glass

It’s important to note that contents owned by tenants are not covered under this type of policy. Only communal items will be covered. Tenants are advised to purchase their own contents insurance to protect their belongings.

Subsidence can go unnoticed for years until it has caused structural damage, so it’s important to make sure that your block insurance covers this.

Property Owner’s Liability

Liability cover is crucial, especially for blocks of flats. As the property owner, you are held liable for the costs of damages awarded to members of the public who are injured while on your property. Costs associated with these damages are often substantial, so having this cover is especially important.

Loss of Rent

If damage or loss causes your property to become uninhabitable, loss of rent cover will allow you to reclaim back loss of rent.

Alternative Accommodation

In addition to loss of rent cover, blocks of flats insurance also offers alternative accommodation cover. This will cover the cost of relocating your tenants should the property become uninhabitable.

Malicious and Accidental Damage

What if your tenants damage your property intentionally or take items that do not belong to them? Malicious damage cover will protect you against these incidents and cover the cost of the damage or replace stolen items.

Accidental damage caused by tenants may also be covered under your blocks of flats insurance policy. This will protect the property’s fittings and floors.

These are the basic covers offered by a typical blocks of insurance policy. Additional products can also be purchased to ensure that you have comprehensive cover.

Optional Cover

In addition to the core cover you will receive with your policy, you can also purchase additional cover to further protect your flats. These include:

  • Employer’s liability: If you have staff members, maintenance workers or caretakers working on the property, this cover is essential. This will cover the cost of damages awarded to employees who are injured while on the property. It’s important to note that this will only cover people that you employ. If you hire an external company, this cover will not offer you protection.
  • Rent guarantee: What if your tenant refuses to pay rent? Rent guarantee will cover this loss for all types of tenants, including students. Cover includes the cost of eviction as well as lost rental income.
  • Legal expenses: Legal expenses can be quite high if injuries occur on your property or you’re forced to go through the eviction process. This supplemental policy will cover the cost of legal expenses for these types of incidents.
  • Home emergency: While this is certainly not a mandatory policy, it’s a convenient one. Home emergency will offer your tenant’s immediate assistance if an emergency occurs. This assistance is available 24 hours a day, 365 days a year for emergency maintenance. It includes labour parts and call out fees for emergencies involving plumbing, home security, pests, heating and cooling system.
  • Terrorism: If terrorist activities damage your property or cause losses, terrorism cover will provide you with important protection.

For freeholders and property managers, blocks of flats insurance provides you with essential cover that a typical buildings insurance policy may not be able to provide.