Landlords insurance – top 10 things to look out for
Comparing landlord insurance quotes can be hard work. You could put the policy documents next to each other and try to spot the differences – but what do you do if you have 20 or 30 to compare? How do you work out which one is right for you? Steve Cox, Business Account Manager at Alan Boswell Group, provides his top 10 tips to help you find the right landlord insurance for your buy-to-let property.
1) Check for additional fees
Some companies hook you with a cheap premium but charge hefty admin fees if you want to make changes down the line.
While checking the small print, it’s worth looking at the payment options and charges, because a cheap premium can get expensive if you’re paying monthly.
2) Get a UK-based claims service
Insurance is a funny purchase; you buy it in the hope you never have to use it. However, the claims process is where you see the true value of your policy. A key thing to look out for is a UK-based company that runs its own call centres and has control over the quality of its service.
3) Home insurance is not the same as landlord insurance
Many landlords don’t realise they need specific insurance for their buy-to-let properties. However, home insurance is designed for owner-occupied properties, not tenanted properties. Although some home insurance products may stretch to renting out the property, they are not designed specifically for it. Make sure you seek out adequate landlord insurance and don’t leave things to chance.
4) Make sure loss-of-rent is included
If your property suffers a claim, most landlord products should include cover to provide an income while the property is uninhabitable. If your insurance policy does not include this, you could end up out of pocket as the result of a claim.
5) Ensure that malicious damage is covered
Malicious damage by a tenant is surprisingly common. When comparing policy details, look for malicious damage cover. It may be included, but it can also be an add-on, depending on the insurer. Make sure you’re clear about whether this is included before you buy a policy.
6) Check excesses to avoid surprises
Some claims occur more often than others and may have higher excesses applied as a result. Escape of water is the most common property claim and will often have a higher excess to cover these costs. There is generally a standard policy excess that applies, with specific excesses highlighted in your quotation documentation. Make sure you read them and be happy with what you’re signing.
7) Read the important conditions of the policy
Each insurance product has terms and conditions attached – it is essential that you follow them. An example is the condition that a tenancy agreement is place. While this may seem obvious, if you’re letting to friends or family you may not put one in place. However, the failure to do so could invalidate your insurance.
8) Ensure cover for manufacture of drugs is included
This provides cover in the event that a tenant damages your property through drug production. Cannabis farms, for example, can lead to the destruction of property. Failure to insure against this could destroy your investment.
9) Review unoccupancy rules
We would all love our trouble-free tenants to stay forever, but when the average length of a tenancy is under a year, the chances are you will have untenanted periods. Different insurers will cover different lengths of time. Some will give cover for up to 90 days, but others may immediately restrict cover.
10) Look at independent research
The internet is a fantastic way of researching companies and products. Check out whether the company you’re about to place your trust in has the trust of its customers and has a satisfactory claims experience. For instance, we’re proud of our outstanding, independent customer reviews, which you can read on independent review site Feefo.
If you’d like to know more about landlord insurance, click here or give us a call on 01603 216399.
About the author:
Steve Cox
Account Manager, Alan Boswell Group
With almost 30 years with Alan Boswell Group, Steve has an in-depth knowledge of the landlord insurance sector, having worked with some of the largest insurance providers in the UK.
