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Landlord’s Insurance…the forgotten risks

When arranging to insure your buy to let property it’s only natural to focus on the obvious perils such as fire, theft and malicious damage. However, many landlords’ existing policies do not provide sufficient protection against a variety of non-obvious risks involved in owning and letting property.

We’ve set out the main covers that could possibly be missing from your existing insurance policy:

  • Accidental Damage, Subsidence, ground heave and landslip

Not all insurers include these perils as standard. It is normally an optional peril on the buildings and contents section of covers.

  • Loss of rent

This covers loss of rental income following damage either to the buildings or contents (or both) by any cause covered by the Property damage section. This is normally an optional cover within your property owners insurance.When taking out this section of cover, landlords will need to consider the maximum time it could take to repair/rebuild the property in the event of a total loss, factoring in the time it would take to obtain planning permission, obtain new architects plans, physically construct the property and then find new tenants to move in.

  • Alternative accommodation

Where your tenancy agreement stipulates you are responsible for providing alternative accommodation in the event the property is uninhabitable due to an insured event, this will cover the cost for suitable alternative accommodation for your tenants. This can normally be incorporated into your property owners insurance for an additional premium and is normally a % of your buildings sum insured.

  • Legal Expenses & Rent Guarantee Insurance

This is an additional policy that can run alongside your property owners insurance. The policy covers  your legal costs in defending a variety of disputes including tenancy disputes, employment disputes, health and safety disputes and contract disputes. It also provides you with both an online and telephone advice service that can give you practical guidance on human resource and health and safety compliance. Importantly, this policy also covers landlords in the event of their tenant defaulting or failing to pay the rent. The annual premium for this policy with 6 months rent guarantee is £93.42 or £115.39 for 12 months rent guarantee inclusive of Insurance Premium Tax.

  • Loss Recovery

This service appoints a chartered loss adjuster in the event of a property claim of over £5000 in value. The loss adjuster will then work on your claim on your behalf negotiating interim payments where required and minimise the disruption to your income.

  • How to check you are sufficiently insured

Mitchell Charlesworth Insurance Solutions can review your existing property owners’ insurance arrangements and help identify any potential gaps in cover.