Regular home insurance does not provide adequate coverage for landlords, so it’s essential to find a package that does. There are several types of landlord insurance deals to choose from, so let’s take a look at each of them and what exactly they cover.
Is having insurance as a landlord a legal requirement?
There is no legal requirement to take out landlord insurance, but this doesn’t absolve the need for it. If you don’t take out landlord insurance, you could be breaking the terms of your mortgage agreement, or you could invalidate your contents and buildings insurance.
Ultimately, it is in your best interest to have landlord insurance in place. Letting out a property means entrusting it to tenants, and it could cost you greatly if something goes wrong.
Related: Exploring your rights as a landlord
Types of landlord insurance:
Owning a rental property comes with the risk of financial setbacks, both minor and major, so insurance is a vital safeguard that is well worth the extra cost. The level of coverage you need will depend on what type of property you let. Different types of landlord insurance include:
Buildings insurance
This type of insurance covers the structure of your property and any permanent fixtures, such as bathroom and kitchen fittings.
Buildings insurance should also cover the cost of rebuilding in the event of flooding, fire, storm damage, or vandalism. If your property is part of a block of flats, make sure to check if the leaseholder’s insurance covers this aspect.
Related: Should landlords buy leasehold or freehold?
Contents cover
Contents insurance is essential if you rent out a furnished or semi-furnished property. It covers the cost of replacing or repairing your appliances, carpets, furniture, and fixtures in case of damage or theft. You can also add accidental damage cover to your package to protect against your tenants breaking things by mistake.
Landlords liability
Landlords liability insurance covers some of the legal aspects of renting. If your tenant or visitors make a legal claim against you for injury or damage to their property for which you are at fault, landlords liability insurance can cover your legal fees.
Loss of rent protection and rent insurance
If your property becomes unsafe to live in due to damage covered by your policy (such as fire or flooding), rent insurance covers the rental income you lose out on during repairs.
Related: Top 10 mistakes that landlords make and how to avoid them
Emergency home insurance
Emergency coverage for landlords is usually offered as an added extra, but it’s still an important consideration. This type of insurance provides cover for urgent repairs that need immediate attention, such as a burst pipe, boiler breakdown, or electrical failure. Emergency home insurance typically includes access to a 24-hour helpline and covers the cost of calling out tradespeople, as well as parts and labour for repairs.
Accidental damage insurance
Accidental damage insurance covers unforeseen and unintentional damage to the building or its contents. For example, if a tenant accidentally spills red wine on a carpet or breaks a window, accidental damage insurance can cover the cost of repairs or replacement. While it’s not always included in standard landlord insurance policies, adding accidental damage cover can provide extra peace of mind, especially if you rent to families or students.
Unsure of what insurance you need as a landlord?
Being a landlord can be a rewarding investment, but it comes with its own set of risks and responsibilities. One crucial aspect of managing rental properties in the UK is ensuring you have the right insurance coverage.
By understanding the different types of insurance available and selecting policies that suit your specific circumstances, you can safeguard your rental property business and enjoy greater peace of mind. Get in touch with the expert lettings team at Ellis & Co for more advice on managing your rental property.
Thinking about becoming an investor? Contact our team today for more information
Further reading
A landlord’s guide to student lets
Why DIY tenancy agreements are a bad option
A complete guide on how to become a landlord
