How Much Landlord Insurance REALLY Costs

UK Landlord Insurance Cost

I’ve seen the question of landlord insurance cost tackled numerous times by various different websites, and I’m always amazed at how far off their “rough costs” are compared to what I actually pay in reality.

If you fall down the rabbit hole – or, even if you briefly poke your head down it – you’ll likely discover that the general consensus is landlord insurance costs approximately £180 per year on average.

I personally pay more. Quite a bit more.

But I know why the discrepancy is jarring, it’s because when most people are referring to landlord insurance, they’re meaning basic building insurance, and not any of the other useful and popular types of insurance and add-ons available to landlords.

So yes, while £180 per year for landlord building insurance is about right – and the absolute bare minimum every landlord should have in their possession – I’m reluctant to end the conversation there, because I believe splashing out on extra protection is worth the investment. And I know I’m not the only one, which is precisely why so many experienced landlords pay north of the average (£180). Actually, I’d argue the whole £180 price-tag is a bit of a marketing gimmick used by insurance companies to highlight how cheap insurance can be. But really, it’s the price of a Tesla without the charging cable.

In this blog post, I’m going to cover:

  • The different types of landlord insurances available and how much they approximately cost (this will give you a better idea of how much you’ll actually pay)
  • What impacts the cost of landlord insurance
  • Where you can get the various types of landlord insurances available

Different types of Landlord Insurances & how much they cost

Insurance TypeImpacts CostAvg CostQuotes

Building Insurance

Covers damage to the structure of the property, such as the walls, roof and floors, caused by fire, explosion, storms, floods, earthquakes. theft, attempted theft and vandalism.

Impacts Cost

  • Type of house (e.g. terrace, detached, semi-detached, flat etc)
  • Age of house
  • Rebuild cost
  • Type of occupancy (e.g. private, commercial)
  • Number of properties being covered
  • Location
  • Type of building (e.g. listed)
  • Excess fee
Price
£180per year
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Building & Contents Insurance

Everything covered by building insurance, plus the contents, such as white goods, furniture, carpets, curtains etc.

Impacts Cost

  • Everything listed above
  • Value of coverage
  • Extent of coverage
Price
£330per year
Get Your Quote

Boiler Insurance & Cover

Covers breakdown service, repairs, leaking gas supply pipe, boiler service, and safety inspection.

Here’s more on Landlord Boiler Cover & Insurance, if you’re interested.

Impacts Cost

  • Type of boiler
  • Age of boiler
  • Service history
  • Extent of coverage
  • Excess fee
Price
£140per year
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Maintenance & Home Emergency Cover

Covers plumbing, home electrics, windows, locksmiths, drainage engineer.

Here’s more on Landlord Maintenance & Home Emergency Cover Insurance, if you’re interested.

Impacts Cost

  • Type of boiler
  • Age of boiler
  • Service history
  • Extent of coverage
  • Excess fee
Price
£260per year
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Rent Guarantee & Legal Insurance (RGI)

Covers rent arrears and any associated legal costs to evict tenants.

Here’s a guide on Rent Guarantee Insurance, if you want to know.

Impacts Cost

  • Rent amount
  • Type of tenant (e.g. employed, dependent on benefits etc)
  • Protection amount
  • Excess fee
Price
£160per year
Get Your Quote

Loss of rent insurance

Protects against loss of rent when a property becomes uninhabitable after an “insured event” (e.g. fire, flood etc.) and cost of alternative accommodation for tenant.

NOT to be confused with RGI (and vice versa)

Loss of rent insurance is usually included or is available as an optional add-on for a broader policy, usually building insurance – I’ve personally never seen it available as a standalone product.

Here’s a guide on Loss of rent insurance, if you want to know.

Impacts Cost

  • Value of cover
  • Extent of cover
Price
£35per year (add-on cost)

N/A

Landlord liability insurance

Covers compensation claims made by a third party, like a tenant, visitor, or service tradesperson. If someone gets injured at the property, they could blame you as the landlord, and this type of insurance can cover the compensation costs and legal fees.

Landlord liability insurance is often included or is available as an optional add-on to other policies – I’ve personally never purchased it as an individual policy.

Impacts Cost

  • Value of cover
  • Extent of cover
Price
£50per year (add-on cost)

N/A

Legal protection

Provides access to legal advice helpline, legal expenses (including eviction costs), tax investigation cover, property disputes legal cover.

Landlord legal protection cover is often included or is available as an optional add-on to other policies (e.g. building and RGI insurance) – I’ve personally never purchased it as an individual policy, although I know it’s possible to purchase as an individual policy.

Impacts Cost

  • Value of cover
  • Extent of cover
Price
£40per year (add-on cost)

N/A

That’s quite the menu, aye?

Your natural response might be, “I don’t need half of that crap” And you’re probably right, you don’t. I certainly don’t sweep all the items into my shopping basket, because I imagine, much like yourself, you ain’t made of money.

However, you’ll likely be interested in more than just the basic building insurance (I’m guessing). Who wouldn’t be interested in having rent guarantee insurance? (especially in the midst of the current God awful cost of living crisis!)

Key points to consider

Costs are averages and estimates

It can’t be overstated that I’m basing my numbers on publicly available averages, the most common scenarios and personal experience.

Costs will vary depending on personal circumstances, including the extent of coverage required. Plus, it usually works out cheaper if you add on more coverage from the same provider where possible (e.g. building, contents, legal and liability), instead of getting separate policies from multiple providers.

Building insurance is the bear minimum, everything else is extra

I’m hoping this is a no-brainer!

Even though there is no legal requirement for landlords to have building insurance, it’s still considered essential. So if you’re hell-bent on spending as little as possible on landlord insurance (no judgement from me), just make you grab building insurance.

Building insurance will protect your asset, so without it, you stand to lose everything in the event of the worst case scenario striking.

One policy Vs Separate policies

it’s unlikely you’ll be able to get ONE insurance policy from one provider that will cover every type of landlord insurance available (because some are specialist products). However, what you will be able to do is get multiple policies (from either the same provider or a few different ones) that will be able to cover the spread of protection that you require.

For example, one provider might be able to provide you with Building with the option to add-on extras like contents, and legal cover.

But then you might have to go to another provider that offers Rent Guarantee Insurance (RGI) and Liability cover.

Shop around before renewing your policies (and potentially save 50%)

One of the biggest mistakes I see landlords make when it comes to insurance is blindly auto-renewing policies with their existing provider before shopping around for better rates. Alas, that’s definitely the most convenient way to overspend.

Insurance providers rarely ever reward their loyal customers with discount rates (which is actually mind-blowing). In fact, they usually do the complete opposite – hike up the rate, and then like clockwork, blame it on increased operational costs, a tough economy and inflation. Or as I like to call it the shameless landlord insurance renewal scam (yup, of course I’ve thrown a public hissy-fit about it). Alas, many landlords blindly take the bait and accept the new rate, while being completely oblivious to how uncompetitive the rate they’re paying actually is!

Please, for the love of God, shop around! I’ve saved around 50% the last time I did.

From my experience, I’ve always got a substantially better deal by comparing the market at the end of a policy and switching to a new provider. It may sound like a complete ballache, but honestly, it only takes about 20 mins and the saving is worth it.

Insurance is a hedge against disaster, so get what you need and be open to change!

I know, I know! it’s always tempting to opt for the bare minimum (building insurance), but I always urge landlords to remember that insurance is a very cost-effective hedge against disaster. Would you rather pay £150’ish for rent guarantor insurance, or potentially lose thousands in rent in the event that your tenant defaults falls into arrears?

I personally usually get the following coverage (either as individual policies, or bundled into a couple of policies):

  • Building insurance
  • Rent Guarantor Insurance
  • Landlord liability insurance
  • Legal expenses

… and that’s why I pay more than the average £180.

I must stress though, what I’m covered for is a tactical and conscious decision. I don’t get contents insurance because all my rentals are unfurnished. I don’t get boiler insurance because my boilers are all relatively new and routinely serviced, and I’ve historically had very little problems with them (that’s because I’m a big believer in choosing quality boilers for rental properties).

Your circumstances might be different, so it’s up to you to hedge your bets in a way that makes sense for your circumstances.

it’s also worth noting that I’m always open to the idea of getting more or less coverage as my circumstances inevitably change (on a per property basis). For example, if I suddenly start incurring extra costs on maintenance costs for a particular property, I may consider getting Maintenance & Home Emergency Cover.

Do I usually make claims and benefit from my insurance? Hell no. Just like most people don’t claim on their car insurance (and therefore feels like a massive waste of money). But I sleep better at night knowing I’m covered if shit hits the fan (which is what insurance is largely all about, peace of mind). However, I have made substantial claims in the past that’s saved me a buttload of money, which has covered my insurance costs for the next decade.

Landlord out xoxo

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