Most landlords drive off into the sunset after snapping up their standard BTL building insurance policy, “We’re all covered”
Yeah, well, that’s usually the case. But not always.
What many landlords don’t realise is that most standard BTL building and contents insurance policies, and residential for that matter, enforce something known as a 30-day rule, which means your property is not covered if it’s left unoccupied/empty for more than 30 consecutive days.
Now that’s a pretty common scenario for landlords, particularly in the following cases:
- In-between tenancies
- During periods of refurbishment
- If your property is for sale
- If you simply want to keep property unoccupied (for whatever reason)
So what’s the solution? Unoccupied Property Insurance (also often referred to as “Home renovation insurance” and “Empty property insurance”).
Do you need Landlord Unoccupied Property Insurance?
Like every other types of landlord insurance, insurance is not a legal requirement as far as landlord law (the Housing Act) is concerned. So if you’re asking if it’s legally required, the answer is no.
However, whether you should get suitable coverage if your rental property is empty for an extended period of time, presuming your current policy doesn’t cover you, now that’s another question altogether.
First and foremost, if you currently have building insurance, check your policy to determine whether you’re restricted by the 30-day rule (or a similar rule that stipulates how long your policy provides cover for while it’s empty). If you’re unsure, contact your insurer for clarity.
If your property will remain empty for a duration longer than your standard landlord insurance policy will cover you for, then obviously it’s definitely sensible to arrange suitable coverage.
If you don’t have any insurance at all but your property is currently empty, it is recommended that you acquire an empty/unoccupied property insurance policy immediately.
If you’re umming and ahhing on whether you should ‘chance it’ and go without, perhaps it’s worth bearing in mind that an unoccupied property is more likely to be the victim of theft and vandalism, intruding squatters (which can be expensive to remove), and they’re also more prone to structural damage e.g. if a pipe bursts they’ll be no one around to limit the damage and manage the repairs. For those reasons, insurance providers tend to consider unoccupied properties as higher risk (compared to occupied properties).
Do I need to tell my insurance company that my rental property will be empty?
Just to prepare you, the general guidance throughout this blog will be to “check your policy” It’s the best way to determine what you should or shouldn’t do (other than contacting your insurance provider directly).
If your property is going to be empty for longer than your policy will cover you for, then definitely notify your insurer. If they don’t require you to purchase any additional coverage, you should request written confirmation. If they require you to purchase additional coverage, then you’re most likely to get written confirmation of the extension, but either way, it’s important to ensure you receive written confirmation.
What if I don’t tell my landlord insurance provider that my property will be empty?
If you exceed the permitted allowance of empty days as specified in your policy (typically 30 days), then your policy will most likely be invalidated, in which case you will not be able to make a valid claim if required.
Is it worth running the risk? Most certainly not.
How long can my rental property be empty for before my insurance becomes invalid?
It really depends on your existing policy. You should check the terms of your policy to confirm how many days your rental property can remain empty for before it invalidates. If you can’t find any specific clauses on the matter, you should contact your insurance provider for confirmation.
I’ve said that the max is 30 days a couple of times, but that’s usually the minimum. Some policies will allow more days e.g. 60 days. Actually, it’s quite common for landlord insurance policies to allow more than 30 days because void periods are more common in rentals, but that’s not always the case. Most residential insurance policies allow 30 days.
How much does Landlord Unoccupied Property Insurance cost?
It varies, of course.
Much like regular building insurance, the cost for unoccupied building insurance will depend on a few details, which include:
- The provider you use
- Value of the property
- Contents of the property
- Location of the property
- How much security the property has
- How much excess fee you’re willing to pay
- The level of coverage you require
However, to give you a ballpark figure, the average price for a policy to cover an empty property for 31 to 60 days is £130.
If you want to grab a quote, you can quickly get one online from simplybusiness.co.uk – they’ll compare products across a network of leading brands, and find you the best available deal.
What does Landlord Unoccupied Property Insurance cover?
It’s important to remember that each policy can differ and there are different levels of coverage available, so you should get a policy suitable for your specific requirements. But generally speaking, most unoccupied property insurance policies will cover you against the following:
- Theft: If someone breaks into your rental property or attempts to break into it and steals anything
- Vandalism: If criminal damage occurs
- Legal expenses: If you need to pay legal fees for the removal of squatters, for trespassers or for personal identity theft
- Public liability insurance: If damage is caused by a property that you are responsible for. For example, if a loose roof tile falls and injures someone or causes damage
- Flood damage: word of caution, less and less insurers are covering flood damage due to mass flooding in the UK, so you may want to double-check this one.
Top tips for buying your BTL Unoccupied Property Insurance
- Read and understand all the terms and conditions in your proposed policy before buying it, particularly what you can or can’t claim for. If there are any details you are unsure about, ask your policy provider for clarity.
- The level of security your rental property will have while it’s empty/unoccupied will impact your premium, so you might want to consider putting extra security measures in place before it’s due to be vacant for an extended period of time. Moreover, it’s important to be accurate when providing details of how secure your property is.
- If your property will be furnished or occupied with tools while it’s empty, make sure your policy will cover them.
- Check if your policy requires you to pay an excess fee when making a claim, and if they do, check how much it is.
- Get written confirmation of any discussed details that are not specifically written in your policy, which you feel could come under scrutiny and impact future claims.
- If any circumstances change while you have a policy in place (e.g. the value of the contents in the property changes or security measures have changed), you should make immediate contact with your insurer so they can update their records. Otherwise you may not have efficient coverage.
Disclaimer: I'm just a landlord blogger; I'm 100% not qualified to give legal or financial advice. I'm a doofus. Any information I share is my unqualified opinion, and should never be construed as professional legal or financial advice. You should definitely get advice from a qualified professional for any legal or financial matters. For more information, please read my full disclaimer.