Insurance is an essential requirement for landlords. It provides protection for your property and your livelihood; without it, you could face severe financial consequences if something goes wrong, such as a fire or a tenant injury.
Most landlord insurance policies cover the building and contents, plus some specific liabilities faced by landlords such as loss of rent, alternative accommodation and property owner’s liability. Like all types of insurance, there are risk factors that make it harder or more expensive to secure cover. Let’s take a look at some of the most common…
- The property will be vacant for long periods
As a landlord it is sometimes hard to avoid having an empty property for a while, perhaps due to a gap between tenants or a delay in a new tenant moving in. Many insurers refuse cover if the property is left empty for more than a month or two. Be careful to avoid leaving the property empty, or consider using a house-sitter if this is unavoidable.
- You are having a complete renovation
If you plan to gut a property and carry out a complete refit, be aware that this may affect your cover. Many policies contain limits on the value of renovations that can be carried out, usually around £250,000.
- The property is non-standard
Before you snap up that lovely thatched cottage as a rental asset, check you will be able to get landlord’s insurance. Most policies only apply to ‘standard construction’ properties – anything other than stone or brick walls with a tiled or slate roof could be challenging to insure.
- The property has a flat roof
They were all the rage in the 1960s and 1970s, but flat roofs are notorious for leaks and problems. Some insurers will not insure a property if it has a flat roof or has over 50% flat roof area, particularly if it is fairly old.
- You have no written agreement with your tenant
The absence of written documents can be a legal nightmare if something goes wrong in your property. While most landlords will insist on having a signed agreement, if you let to a friend or family member you might be tempted to skip this step. It’s always better to have agreements recorded in writing.
- You have a poor credit history
Anything that makes you look more risky in the eyes of insurers can make it harder to get insurance. For example, having been refused cover in the past may be a red flag, as can a history of bankruptcy or County Court Judgments in your name.
- The property is insecure
If the property’s security protections are not up to scratch, you may be required to upgrade them in order to obtain insurance. For example, windows should be fitted with locks and doors should be secure with high-quality locks.
- Your tenants decide to sublet
Your insurance may be voided if your tenants decide to let all or part of the property to another party. Carry out regular checks to ensure you know who is living in your property, or you could be left without cover.
Stride is a specialist let property insurance broker. – We understand that not all properties are ‘standard’ construction and not all risks are the same.
If you need property insurance for complex risks, our in-house underwriters can review the risks and tailor cover for your properties.