Buy to Let Landlord insurance UK

As the buy to let properties you own or rent are probably one of the biggest investment you will ever make, it makes both economic and common sense to ensure that both you & they are fully protected. Your buildings insurance and Contents Insurance for furnished properties should be affordable and with an insurer who is going to deal with all claims as quickly and as sympathetically as possible.

Landlords have always had special requirements compared to other homeowners and this is reflected with specialist landlord insurance policies. Insurance for landlords needs to provide cover for claims like damage by tenants and loss of rent, which may not be covered by normal home insurance.

Landlord Buy to Let Insurance Overview

There are many different types of Landlord. From the individual who is renting out their second home to the ambitious property tycoon with an ever-increasing portfolio of trendy dockside apartments. The common theme for all landlords is the need to purchase landlords insurance to protect their investment.

As a landlord, you are effectively using your property as an extra source of income – and this needs to be protected. A normal home insurance policy is not valid when you are taking an income from the property. A residential landlord policy is what is required.

With the correct landlords insurance policy in place, you can relax knowing that should any damage be caused to the property you are protected against the financial consequences. With this peace of mind in place, you can worry about running your property and nothing else.

Examples of claims which Landlord’s Insurance covers you for:

Landlord’s insurance would pay you should the following happen:

• Your property is massively damaged by a fire. Luckily your tenants are not hurt but they have to move out as the damage is so bad. It takes builders and decorators 3 months to repair the damage. Your landlord’s insurance policy would not only pay for all of the work to repair the property but also pay you the rent that you are missing out on by not having tenants living in the property during this period.
• You fall out with your tenants. They stop paying the rent and refuse to leave the property. You are forced to take them to court to get them evicted and collect rent owed to you. If you have purchased the “Legal Expenses” cover as part of your Landlord’s insurance policy then all of your costs accrued in fighting the court case would be compensated.

Frequently Asked Questions

What is the Buildings Sum Insured (BSI)?
You are always asked to give an estimate for the Buildings Sum Insured (BSI) when going through the process of getting a Landlord’s Insurance quotation. This is an estimate of the cost for rebuilding your property should it be completely destroyed. Do not confuse this with the value of the property (which is normally much more – especially in prime city-centre locations) otherwise you will be paying more than is necessary for your insurance. On the other hand, do not be tempted to deliberately understate the BSI since should it come to making a claim the insurers will reduce the amount that they pay you in proportion to the amount you have underestimated.

Why am I not already covered under my normal home insurance?
Home insurance policies will not pay when the property is being used to make an income (for example when you are renting your property to tenants). You must therefore buy a Landlord’s Insurance policy which is especially designed and rated for these circumstances.

I have several properties, do I need to buy one policy per property?
No, you can normally buy one policy which covers as many properties as you have.

How do insurers calculate the premium for Landlord’s Insurance?
Different insurers use different ways of assessing the risk of your property and therefore how much to charge you. Some of the major factors are:

• The location of the property (postcode)
• The Buildings Sum Insured
• The type of tenants in the property
• A history of claims
• The age of the property
• The type of property (flat, detached, terraced etc)

Buy to Let Insurance

Landlord Insurance is commonly also known as buy to let insurance. The cover available under a buy to let insurance policy is the same as a landlord insurance policy. You can get cover for your property, contents and landlords liability insurance. You will also be able to get insurance for a portfolio of properties as well as a singular property.

Buy to let insurance can sometimes be confused with a standard houeshold policy, which usually would not provide cover for a let property and if so is unlikely to include such extensive cover such as property owner liability which is usually included as standard in your buy to let building insurance policy to provide cover against liability claims, for example if your tenant was to fall down the stairs and hold you liable for the injury.

Posted February 9, 2006