Landlord Building & Contents Insurance Guide

Landlord Building & Contents Insurance is insurance designed specifically for rental properties, which covers both the property and the contents inside. Needless to say (at least I hope it’s needless), regular Residential Home Insurance won’t provide valid cover for BTLs.

This guide is here to help you choose the best Landlord Building & Contents Insurance policy for you, and to give you a better understanding of the options available to you. There’s a hell of a lot to choose from… and to get confused by!

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Before I start driving through the details of Landlord Building Insurance, I want to very quickly explain its overall place in the world of landlord insurance.

‘Landlord Building & Content Insurance’ is a type of landlord insurance, along with several others, such as Landlord Rent Guarantee Insurance (RGI), Landlord Maintenance, Emergency & Boiler Cover Insurance and so on. Each type generally has its own purpose, but it’s entirely possible for one policy to cover multiple areas. For example, some policies can provide coverage for building, contents and RGI. Of course, it’s also possible to obtain individual policies from different (or the same) companies that cover different scenarios.

Please go to the landlord insurance blog post for an overview of the types of insurances available for landlords.

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Get quick and easy Landlord Building Insurance quotes

First and foremost, if you haven’t got a policy, or if you’re looking to renew your existing landlord building insurance policy, or if you’re simply looking for quotes, then I highly recommend talking to a specialised insurance broker, so you get access to professional advice and a wide selection of products.

I personally use QuoteSearcher to connect me with an insurance broker to provide quotes. I’ve successfully used (and subsequently partnered with them) for several years now, which is why I don’t hesitate in recommending them.

If you click on the ‘quote’ button below, you will be directed to a landlord insurance form, which will connect you with a specialised QuoteSearcher broker, who can assist with running through your requirements and the options available. I recently renewed my landlord Insurance policy by using the quote form and saved £260, and it only took 20 minutes to get everything up and running. There is no obligation and receiving the quotes is 100% free.

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What is Landlord Building Insurance?

It’s a policy which covers your rental property from physical damage, in the event of fire, vandalism or malicious damage, natural disasters, and subsidence etc.

There are literally hundreds of products available on the market, each varying in the cover they provide, and new ones are being introduced every day, so it’s important to use due diligence when choosing one that best suits your needs.

A specialist insurance broker should be able to provide assistance and guide you in the right direction. You can talk to a broker today, by filling in this form (there is no obligation and it’s completely free)!

Extra coverage

Depending on your policy, the following might also come included or offered as optional add-ons to broaden the coverage of your policy:

Typically included as standard (but not always)

  • Loss of rent protection – covers landlords against loss of rent if the property becomes uninhabitable due to an insured event (e.g. fire, flood, explosion, vandalism etc).
  • Public liability insurance – provides cover against accidental injury or damage caused to a third party or their property. For example, if a builder gets insured at the property.

Typically offered as optional add-ons (but not always)

  • Legal helpline – legal support/advice (e.g. advice when a tenant falls into arrears)
  • Legal protection – covers legal fees (e.g. cost to evict a tenant)
  • Rent Guarantee insurance (RGI) – covers landlord against loss of rent when tenants fall into arrears.

The added protection these extras provide will impact the cost of a policy, whether they’re purchased as optional add-ons or baked into the product as standard, which is why it’s important to compare policies carefully, and not just disregard one because it’s marginally more expensive.

Are the extras worth getting (or ensuring they’re included in your policy)? I can’t really answer that for you, but the reality is (and obviously), the more cover you have the better protected you are.

Personally, I usually ensure my policy includes legal protection, loss of rent protection, public liability insurance, and sometimes, depending on the circumstances I’ll opt for RGI. You may find that many providers don’t offer RGI as an optional add-on, in which case it’s possible to purchase it as a completely separate policy from a separate provider (which I think might actually be the most common way of acquiring RGI. If you’re interested in learning more, here’s my guide on Rent Guarantee insurance (RGI)).

So are those extras worth it for me? Yup. I believe so. They don’t really add too much extra to the premium, to be honest. RGI is usually the most expensive by far, at about £200 per year.

If you’re unsure what to get, get some quotes – that’s usually the deciding factor. If the cost is an issue, then try to find a balance between cost, sensibility, and peace of mind.

What affects the cost of Building Insurance?

The cost of building insurance, whether it be residential or landlord, will depend on several factors, including:

  • Insurance company (each will value and assess risk differently)
  • Depth of coverage (as discussed above)
  • Value of property
  • Location of property
  • Size of property
  • Local crime rates
  • Environmental risks e.g. flooding
  • Previous claims
  • Smoke/burglar alarm installation
  • The number of occupiers
  • Occupation, specifically if you work from home

Why is Landlord Building Insurance so important?

Yup, it’s a no-brainer. Or at least I hope it is.

Buy-to-let properties are large investments, probably your single largest investment (besides from your own residential home), so you need to protect your money in the event of unforeseen disaster. Believe me when I say disaster often strikes in this industry; the world of landlords is fickle and unpredictable at best.

The maths for “why” is simple: pay approximately £150 a year for insurance, or stand to lose your entire investment by an accidental fire. Not to mention, you’ll still be liable to pay the mortgage- imagine how demoralising that would be, paying off debt for a pile of rubble?

No – building insurance is currently not a legal requirement for landlords in England & Wales, but for the reasons mentioned above, it’s not worth going without.

Is there a difference between “Home Insurance” and “Landlord Insurance”?

Yes, there is a difference, and it’s crucial to get “Landlord Building Insurance” if you’re letting your property.

Landlord insurance can be slightly more costly than regular home insurance, so a lot of landlords opt for “home insurance”, assuming they’ll still be covered but at a lower rate. It’s a common mistake that can cost thousands and thousands of pounds.

In most cases, “Home Insurance” policies will NOT cover any claims made in a buy-to-let property. In fact, the insurance policy will most likely be invalid.

Needless to say, Home Insurance covers residential properties, while Landlord Insurance covers buy-to-let properties.

Do I need Contents Insurance?

Landlord building insurance is considered essential, but that’s not always the case with ‘contents’ insurance.

If your property is “furnished” then it’s definitely worth getting content insurance. Additionally, if white goods (cooker, oven, fridge, freezer etc.) are provided by the landlord, which it generally is.

If you do opt for contents insurance, it’s important to be wary of how much you’re covered for. For example, if there is a fire and the kitchen is completely destroyed and you’re only covered for £4,000, you need to consider whether that will be enough to cover all the contents to be replaced. Avoid under-insuring, it’s important not to under value the cost of replacing your contents.

On a side note, it’s typically the tenants’ responsibility to insure his/her own personal possessions if they wish to, via their own tenants contents insurance policy.

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Why do I pay more/less for Landlord Insurance policy than other people?

You’ve been gossiping amongst fellow landlords and the contrasting rates have confused you, right?

There are typically two common reasons for why insurance policies can vary in price, even when the properties themselves are very similar:

  • Insurance premiums are based on the risk and crime levels in different areas.

    Usually insurance companies use postcodes to cross reference police records and their own insurance claims history for the area to assess the risk. So your landlord insurance premium will be based on the stats; it’s nothing personal, and you’re not necessarily getting ripped off. Although, there’s a lot to be said for shopping around to get the best quotes.

  • There are thousands of insurance policies available and they’re not all ‘like-for-like’. For example, some policies are cheaper simply because they provide less coverage.

    So if you’re going to compare policies, it’s important to ensure they’re providing the same coverage.

Top Tips for taking out Landlord Insurance

Understand what your landlord policy covers!

This may seem obvious, but landlords failing to understand what their policy covers is one of the main reasons why many claims are unsuccessful.

Landlord insurance will NOT cover everything, so it’s important to check what your policy covers when you’re getting quotes. If there is something specific you require, for example, ‘malicious damage by tenants’ (which is a perfectly reasonable requirement for landlords), then it’s important to read the terms and conditions to ensure it’s covered. You should also always ask your insurance broker to find a policy which covers your requirements.

Here are a couple of other incidents landlords may want their insurance policy to cover, but don’t always necessarily come included:

  • Malicious damage by tenants
  • Flood damage
  • Accidental damage
  • Rent arrears rent
  • Legal cover (including eviction costs)

This leads me onto my next point nicely…

Landlord Insurance and Fair Wear & Tear

First and foremost, it’s crucial to understand what ‘Fair Wear & Tear’ is, because insurance will not cover any damage due to fair wear and tear. You can read more about it in my Fair Wear & Tear Guide.

Essentially, wear and tear is damage caused by normal living, which is through no fault of the tenant. For example, carpets will naturally wear over time, and it doesn’t mean intentional damage was caused. So landlords won’t be able to make a claim in that case. However, if there is paint spilt on the carpet, or cigarette burns, then the landlord may have a claim (assuming their policy covers malicious damage by tenants) because those incidents didn’t occur naturally.

Many landlords wrongfully try to make a claim for wear and tear, only to be unsuccessful. Damage due to fair wear and tear is a ‘business expense’ which landlords are expected to cover as part of their business.

Don’t be underinsured

I already briefly touched on the subject of being underinsured, but I’ll quickly cover it again, because it’s so important!

Many landlords try to reach for the cheapest insurance policy possible, which may seem like a great money-saving tactic at the time, but it’s often the main reason for being underinsured.

A common scenario is when a policy is taken out for less than the properties actual value, which can result in claims being reduced proportionally. For example, if the cost of rebuilding your property is £100,000 but you insure it for half that, £50,000, you will only be able to claim 50% for the cost of repair. So if you make a claim for £5000 to repair a damaged kitchen after a fire, you will just get £2500, not the full £5000.

Most insurers won’t cover properties that are empty for 30+ days

Be warned.

A lot of insurers impose a “30 day rule”, which effectively means your insurance will be invalidated if your property is unoccupied for 30+ days. However, some insurers are more lenient than others, and you can find ones that allow for either 60 or 90 day vacancy periods. It’s best to check your policy to determine how long your property can remain empty for before your policy becomes invalid.

Most landlords won’t have their properties empty for more than 30 days. However, it is perfectly normal for rental properties to be empty for extended periods of time under certain circumstances, particular during refurbishment and/or in-between tenancies (especially during a slow market).

  • If your property is due to be vacant for a period that exceeds your current policy’s vacant period allowance, you’d be wise to notify your insurance provider pronto. If your insurer doesn’t provide Unoccupied Property Insurance, you can get quotes from my affiliate partner Quote Searcher.
  • If your property tends to remain vacant for extended periods throughout the year, consider securing a policy that offers coverage for rental properties unoccupied for 60 days or more. This way, you won’t have to repeatedly acquire insurance specifically for unoccupied properties.

Flood Protection

This won’t apply to most landlords, but it should be taken seriously by landlords that have properties in areas that are prone to flooding.

Consider whether you would likely benefit from protection against flooding damage, or if it would be a sensible safety precaution… just in case (i.e. you may have had a close call in the past)! But be warned, not all insurers cover flood damage, and those that do usually demand a premium for it.

For more details on how landlord flood insurance works and what to do in the unfortunate event, please go to the Landlord Flood Insurance & Flood Damage post.

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Keeping records up to date with your Insurer

This is crucial.

Insurers are notorious for finding ways to withhold from paying out when a claim is filed. If they can find a reason not to pay out, they will, so it’s in your best interest not to give them one.

If there’s ever a change in circumstance, inform your insurer immediately so they can update your policy. Changes include:

  • New tenants
  • A tenant moves out e.g. divorce/separation
  • If the property is going to remain empty/vacant

If you don’t update your policy by informing your insurer, or at least enquire whether you need to or not, you may find yourself with an invalid policy and unable to make a claim.

2 Join the Conversation...

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C.G 1st February, 2016 @ 18:42

Hi there - thanks for several useful articles posted on your site. I am a landlord with just one property (other than my personal residence), and I am starting to have concerns about my property and the current tenants occupying it. I am the landlord, but the property is managed by a local estate agent who sees to the credit reference checks, handles the rent, advertises it etc and inspects the property regularly during the tenancy period. For this I pay a monthly fee.
To give you some background, the semi-detached 3 bedroom house is currently occupied by a "family" consisting of a married couple and their young child, and a family friend who is the 25yr old son of the couples friends, who was caught in the middle of a divorce between his parents and having nowhere else to go, was taken in by the couple. All of the adults were credit checked,referenced, are in full time employment, and are specifically named on the tenancy agreement. They share the facilities at the property. The house was bought by me (the landlord)in 2010 and extensive improvements were made to the property before it was lived in - first by myself, and then let out to tenants in December 2014. The current tenants are the second ones to occupy the property on a let basis. One of the improvements made was the installation of a chemical damp proof course to the ground floor as rising damp had been found at the property prior to purchase. This was done in November 2010 and is covered by a 30yr guarantee. The property was replastered throughout the ground floor and all floors were replaced with solid oak flooring throughout the ground floor also. The property was also enhanced by the addition of a conservatory which flows from the through lounge / kitchen to the rear of the property. The oak flooring runs throughout the ground floor and into the conservatory, where it is heated via mains electric underfloor heating. I lived at the property until moving out to my current property in December 2014, and I and the tenants who occupied the property from 2nd January 2015 until they moved out in September 2015, were very happy with the property and experienced no problems with the property while they lived there. (In fact, the first tenants asked if they could buy it, but could not afford to). The situation is this. It would appear that at some time the underfllor heating in the conservatory stopped working, but the tenants failed to notify anyone about this. In addition, at some point in time, the tenants noticed that there was a smell of damp in the hallway with a growth of a white mould on the hallway wall.This was also noted by the tenants in the downstairs toilet, which is vented, and in the conservatory. During a routine inpection in December 2015, the agents representative noticed that the tenants had stopped using the conservatory, complaining that it was prone to condensation, and they had actively chosen to ignore signs of mould growing within the property. As their landlord, I was asked by the agent to provide a dehumidifier and I did this without delay. Unfortunately, during the delivery process minimal damage occured to the dehumidifier which stopped it from working temporarily, however, this was quickly rectified and the fully functioning dehumidifier was once again delivered to the property. I was asked to provide the certification for the damp proofing, along with the 30yr guarantee, and I provided this within a day or so of being asked. I was also asked if I would consent to an independent damp proofing surveyor visiting the property, and of course, I complied. I was shocked when the surveyor reported the re-occurance of rising damp to the hallway, and agreed to the agents request for the original damp proofing company also surveying the property with a view to rectifying any problems without further delay, under the 30yr guarantee. Without warning, the tenants then decided to withold their rent for January - something which was unexpected, and something which had a dramatic effect on my own circumstances as I rely upon the rent to pay my mortgage. I have chronic health issues which limit my income and my ability to deal with stress - and this is why I decided to ask a local agent to manage my property for me. After much stress, with the tenants refusing to co-operate or answer calls and e-mails from the agent in order to discuss the rental arrears, and to arrange an appropriate time for the original damp-proofing company to conduct a survey, the tenants eventually agreed to meet with the agent and damp proofing company, and reluctantly paid their outstanding rent on the very last day of the month. Imagine my shock then, when I received a personally addressed letter at my residential address the following day from an environmental officer from the local council, who reported several issues of concern - including rising damp in the hallway, mould in the downstairs cloakroom and in the conservatory, the fact that the underfloor heating in the conservatory was not functioning and accusations that the property needed several things doing to it to meet with current standards. My question is this really - if major works are needed to rectify issues to do with the property - namely the re-doing of the damp proof course and repair to the underfloor heating - where do I stand in terms of the tenancy, and the demands of my local council? And,if the tenants have to leave the property while work is carried out, am I covered by insurance or rent protection to pay my mortgages? I have landlord insurance for buildings and contents and an additional Rent Protection Policy with nil excess. Are either of these going to help me cover my outgoings? I also need to know where I stand with the tenants, as they have failed to adequately report issues, or maintain the property properly, which has undoubtedly affected the integrity of the fabric of my property. The agent has asked the tenants on several occasions to clean the mould with an anti-mould preparation to minimise problems, but they have resolutely failed to do this. I would appreciate any advise anyone has to offer.

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Dom T 19th April, 2016 @ 17:45

It would be interesting hear your thoughts on the different requirements of insurance for a leasehold flat compared to a freehold house. I've read that you do not need buildings insurance for a leasehold flat because it is the freeholder that should ensure the building. Of course the freeholder may choose (most likely) to include within the service charge an element that is to cover the buildings insurance cost that they incur!!!

















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