Things in life can go wrong. No matter how well you plan, you’ll find problems and issues beyond your control pop up, and cause you problems. If you are a landlord, this is highly frustrating. After all, unforeseen issues can cause you money and place your business at risk.
This is why you must have insurance. Some lenders won’t allow a landlord to let property without insurance. The terms and conditions of the buy to let mortgage may state landlord insurance is mandatory, so be sure to check your agreement. However, even if landlords aren’t required to have landlord insurance, it makes sense to do so.
Like all insurance policies, you hope to never claim on your policy. However, if you do need to make a claim, you must have coverage in place. We work closely with many Forest Hill landlords, and we know there are some things you cannot plan or prevent. Therefore, having insurance cover in place provides you with confidence, which is of benefit to yourself and your tenant.
What types of landlord insurance should I consider?
Of course, there are different types of insurance coverage to consider. Your budget, your needs and your expectations all influence the decision you need to make on which policy is best for your needs. Your personality type and whether you are comfortable with risk will also affect your thoughts about insurance. However, bear in mind the costs associated with problems arising are significant and could bankrupt you if you don’t have support or cover in place.
Landlords building insurance
With landlords building insurance, you are covered for the repair or rebuilding cost when the rental property has been damaged by flood, fire or vandalism. If you own the rental accommodation, but there is a freeholder for the building, the freeholder is responsible for building insurance. In this instance, the landlord should focus on the fixtures and fittings at the rental property.
Landlords’ contents insurance
Landlords often have to decide between offering a furnished and unfurnished property. If you provide a furnished property, you need to have contents insurance. This policy covers the repair or replacement of items which are damaged by flooding or fire. If you are keen to ensure you have cover for accidental damage, you need to have an additional insurance policy.
It is important landlords make sure tenants have their content insurance in place. Landlords’ content insurance only covers furniture provided by landlords; it doesn’t offer cover for furniture owned by the tenant.
Property owners’ liability insurance
If you are worried about facing a compensation claim, either from a tenant or visitor, property owners’ liability insurance will cover you. This policy isn’t the most common form of landlord insurance, but given the vast sums associated with claims, you’ll be glad you have it in place.
Also, you may wish to consider insurance that protects you if a tenant fails to pay their rent. If your buy to let mortgage payments depend on timely rental fees, you will likely benefit from additional support in this area.
At Hunters Forest Hill, we know letting your home is hard, but we are here to assist you in the process. If you aim to buy, sell, let your home or rental property, we are active in New Cross, Peckham, Dulwich and Brockley, in addition to Forest Hill, so get in touch with one of the top three agents in London, and we will be happy to assist you.