Surprisingly, Landlord Insurance isn’t a legal requirement *scratches head*
But the reality is, the risk of going without insurance is far too high, and I’d seriously have to question the mental state of anyone that dares to run the risk. As far as I’m concerned, being covered by an adequate policy is essential.
The only dilemma is, with so many types of landlord insurances to choose from, it can seem like a bit of a minefield.
So, let’s dance through some of the need-to-knows, including your options…
Types of landlord insurance products
There was a time when BTL Landlord Insurance was relatively simple, you either opted for a policy that covers the property/building against damages or one that covers both the building and the contents inside against damages.
Typically, landlords with furnished properties opt for policies with building and contents cover, while everyone else heads towards the bog-standard building cover. Pretty simple.
Those options are still available, and they’re still undoubtedly the most common policies landlords opt for… and arguably, essential.
However, in today’s thriving BTL market – where many of us are in the line of fire more than ever (for various reasons) and consequently require more protection – there’s a lot more on offer! The market heard our cries and saw our difficulties, and they provided us with a whole range of landlord insurances of all types to choose from!
The good news is, it’s still all relatively straightforward, so hopefully you won’t feel like pointing a gun to your head after you’ve soaked it all in.
Below is a list of the different types of insurances available, or at least the types most landlords should be aware of. These days you can pretty much get insured for anything if you’re prepared to pay the premium.
Many generic landlord insurance policies actually cover a little bit of everything listed below. For example, most landlord policies cover building damage and legal fees (to a certain amount). However, some policies are also completely isolated to a specific type of insurance (e.g. you may have a policy that ONLY covers building damage and nothing else), so it’s useful if I break it down.
Landlord insurance policies are very much like any other type of insurance- you can have a policy that covers the basics, but you can also apply a bunch of add-ons for extra protection- it really boils down to how much protection you want and how much you’re willing to pay for it.
My advice is to talk to a insurance broker, tell them what you want (e.g. building insurance and contents cover), and they should be able to provide you with a suitable package and price- no obligation, no fees.
1) Landlord/BTL Building Insurance
This type of insurance is considered essential. ALL landlords should at least have a BTL building insurance policy in place.
A landlord building insurance policy covers your BTL property from any damage, which may include fire, vandalism or malicious damage, natural disasters, and subsidence etc.
There are literally hundreds of policies available on the market, and new ones are being introduced every day, so it’s important to use due diligence when choosing the best policy to suit your needs.
An 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)!
For more information, go to the Landlord Building & Content Insurance Guide.
2) Landlord Contents Insurance
Landlord building insurance is considered essential, but the same isn’t typically said about contents cover. Whether it’s suitable for you generally depends on the contents of the property you’re letting.
If your property is “furnished” then it’s worth considering contents insurance. Additionally, if white goods (cooker, oven, fridge, freezer..etc) are provided as part of the let, then it also might be worth considering.
If the property is unfurnished, then it’s ultimately down to the tenant to get their own suitable Tenants Contents Insurance policy to cover their personal belongings. Landlords are NOT obligated to insure the tenants possession.
You can usually get content insurance with building insurance, you don’t need separate policies or insurers, so when you’re arranging your building insurance, make sure your policy covers content (if you want it, that is). Needless to say, there will be a small premium if you’re looking for a policy that covers both building and contents.
For more information, go to the Landlord Building & Content Insurance Guide.
3) Rent Guarantee Insurance (RGI)
This is a type policy that protects landlords against loss of rent. It’s most commonly relied on when tenants fall into arrears and are unable to pay rent, or simply refuse to pay rent (for whatever reason). In this instance, the insurance company will cover the rent, or at least a percentage of it- depending on your policy.
This type of insurance has nothing to do with the property or the contents, it only insures against rental loss.
Generally, you’ll need to take out a separate insurance policy from your building/contents insurer, because not all landlord insurers provide this type of cover, it’s quite specialist (there are plenty around though).
For more information on RGI, go to the Landlord Rent Guarantee Insurance (RGI) Guide.
4) Landlord Maintenance, Emergency & Boiler Cover Insurance
These are relatively new products, but you may have seen them popping up- they’re becoming increasingly popular with landlords, especially since they cover boiler maintenance, which is particularly useful, and therefore popular with landlords.
This type of policy generally covers gas and electrical breakdowns in a BTL property. You may have seen British Gas heavily advertise their landlord insurance cover on TV.
Essentially, you pay with in the regions of £15 per month, and British Gas (or to whoever is providing the cover) will attend to your gas and electricity related issues with in 24 hours. This can be a very useful product, particularly for old houses with old fittings that are prone to frequent breakdowns.
One call out could quickly pay for the policy itself. It’s worth considering.
For more information and available suppliers, go to the Landlord Maintenance, Emergency & Boiler Cover Insurance Guide.
5) Legal Fees Insurance/Protection
Most RGI insurance policies come with legal fee insurance (it’s usually part of the overall package), but I know you can also get it as a isolated extra (e.g. you can get legal fees insurance without the rent guarantee option). You can also usually add ‘legal fees cover’ on as an extra to most policies, but for a small premium of course. When I applied for my landlord building insurance cover, my insurer wanted £50 extra for legal fee cover.
Landlord legal fees insurance covers any legal expenses. For example, in the event of a tenant eviction. Generally, if you’re dealing with a tenant that falls into arrears and is reluctant to vacate, the legal expenses to evict the tenant can quickly start stacking up, especially if it ends up in court. All those fees can be covered with this type of policy/extra.
6) Public liability Insurance
Public liability cover typically comes included with most insurance policies, however, it’s better to be made aware of what it means so you can ask the question when you’re getting your insurance policy.
The public liability schedule refers to being insured for accidental injuries incurred by your tenants with in the confinement of your property e.g. if they suffer any injuries from a nasty fall down the stairs.
Since the UK is becoming ever more litigious, every landlord should have public liability insurance to cover themselves. Tenants are becoming much more savvy about getting “no win, no fee” solicitors involved (it’s pretty sad, but everyone wants that easy buck)!
It’s always worth checking to see if your policy covers public liability.
Do I need landlord insurance?
Currently, there is no legal requirement for UK residential landlords in England or Wales to have any form of insurance policy. Most policies are available to provide ease and reassurance, nothing more. However, in all honesty, you’d have to be a complete and utter fool not to at least have a building insurance policy.
It really doesn’t make any sense not to have a BTL building insurance policy.
The maths 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 burnt rubble.
Buy-to-let properties are large investments, probably your biggest investment, so you should be protecting your money from unexpected dilemmas (which sadly, occurs more frequently than we’d like to think).
Assess your needs and get the insurance policy(ies) you feel necessary. There’s a lot to be said about feeling at ease when you know you’re armed to the teeth with adequate insurance.
Quick and easy Landlord Insurance quotes
If you’re interested in getting landlord insurance, then I would highly recommend talking to an insurance broker. Not only will they provide you with specialist advice, but you’ll also get access to the best products on the market at the most competitive rates. There is no obligation and receiving the quotes won’t cost you a penny, it’s 100% free.
If you click on the link below, you will be directed to a landlord insurance form, where you can compare some of the best quotes around by talking to specialised brokers! 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.
Even if you currently have a policy, it’s well worth shopping around and preparing yourself for when your current one is due to expire, because it’s an incredibly competitive market.
Top tips for buying your landlord insurance
- Read and understand all the terms and conditions in your proposed policy. Often the cheapest isn’t always the best suited for your circumstances, and that’s especially true with insurance! If there are any details you are unsure about, ask your policy provider for clarity.
- Make sure your policy is suited for your specific circumstances so you avoid over or under insuring.
- Check if your policy requires you to pay an excess fee with any claims, and check the amount. Generally speaking, policies with higher excess fees have a lower premium.
- 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 through an existing policy (e.g. you build an extension or there is a change in tenancy), you should contact your insurance provider immediately to update their records. Otherwise they may refuse any future claims.
- Auto-renewing or remaining loyal to your existing insurance provider is often the most expensive way to renew insurance products. Always get new quotes before your current policy is due to expire. Often, your current provider will even match your best quote (as long as it’s a like-for-like product), even if their initial renewal quote was significantly more expensive.
- Don’t forget, landlord insurance is tax deductible :)