An analysis of claims received has highlighted issues within the sales journey and how the products/service are positioned with clients.
With this in mind we have developed some essential guidelines below for our products
As a Letting Agent under Financial Conduct Authority rules, you are not allowed to sell, arrange, or promote insurance to your clients. Arranging insurance without proper authorisation could lead to enforcement action being taken by the regulators.
Managed properties – You are able to purchase a policy yourself and then provide the benefit to your landlord as part of a rent guarantee service (e.g. rent collection, paperwork, help in the event of a claim etc)
Non-managed properties – Clients can be referred to Alan Boswell Group utilising a unique link to your agency.
A fundamental part of adhering to FCA regulations for this product is that no policy documents or schedules or Alan Boswell Group invoices are passed on to the landlord.
We appreciate that this can present a problem so have devised a document called Contract of Guarantee. This document is to be used with landlords to explain the process in more detail and how it works as part of your service.
This is an important document as it makes clear to the landlord the benefit they are receiving is an extension to the service that you offer, and it is separate to and distinct from the rent guarantee insurance that you buy from us.
The contract of guarantee document that follows also makes it clear that any rental defaults will be individually reviewed by you as their agent, and that you will discuss available options with them if the tenant were to fall into and remain in arrears.
The guarantee has to be a relatively small part of the overall service that you provide and your clients need to be able to use your services without having to take the guarantee.
You must ensure that any charge needs to form part of your managed service charge and is subject to VAT, there cannot be a direct cost to the landlord for the insurance.
Such a charge may be levied as follows :-
Largely driven by market forces, the costs for the added benefit of having the guarantee needs to be proportionate and reasonable.
You can only renew the guarantee if you are still fully managing the property and you are not aware of any changes to the tenants financial situation that may lead to them no longer being able to meet their monthly rental obligations.
Failure to adhere to the above guidelines may result in access to Alan Boswell Group products being removed and commission share arrangements being terminated.
Claims may also be invalidated if the above process has not been followed.
If in doubt please contact us. We deal with tens of thousands of properties so have encountered many different scenarios. We are there to handhold through the purchase process and welcome questions. Some queries in the past have helped us develop the proposition positively and widen the cover so we encourage questions.