Insurance News Archive

Landlords advised to take out rental guarantee insurance

Landlords are being advised to take out insurance which will guarantee rental income and legal expenses to protect themselves against tenants defaulting on payments in the recession.

Sales and lettings agency Young London suggests investing in insurance when signing up new occupiers, especially in the current economic climate.

If tenants are struggling to pay their rent and the local letting market is fairly strong the landlords may want to consider allowing their occupiers to break their contract so that they can let the property to renters who can afford the payments.

"That might mean writing off any rental arrears but in the long run could mean you waste less time and money, and could avoid a costly legal bill," the agent says.

Finally, maintaining a good relationship with tenants is important so that they feel able to let their landlord know if they lose their job.

Keshav Thukaram, managing director of smartlandlord.co.uk, has echoed Young London's advice, saying rising unemployment remains a particular concern for landlords, who should consider taking out insurance.

30 Apr 2009