The last few months have seen tremendous change within the UK and the world. With never before seen legislation brought in across the UK to protect tenants and many business having to make job losses, rent guarantee products have been caught in a perfect storm.
Initial estimates suggest the number of claims have gone up five-fold and with eviction bans in place the average claim length will clearly increase. This has put pressure on insurers and the introduction of new rules has meant insurers have had to adopt new processes to cater for these legal requirements.
There are a couple of key changes that effect the claims process:
The need to mediate – Behind all rent guarantee claims is a ‘reasonable prospect of success clause‘. In plain English this clause means that a claim will only be considered if there is a 51% chance, or greater, that the claim will will be successful if it goes to court. This clause is in place to stop frivolous claims and ensure they are only pursued where the landlord has met their legal requirements (to protect tenant deposits, respond to maintenance requests etc). This clause is essential to be aware of during the current legislation.
If and when the eviction ban is removed and policyholders wish to progress to eviction landlords will need to evidence that clear attempts to mediate with tenants have been undertaken. This may be in the forms of deferred arrears, reduction in rent or use of deposit. It is important that whatever mediation is attempted or agreed has been fully documented as this may later be relied upon during the claims/court process.
Extension of notices – Timescales for the serving and expiration of notices have changed significantly and it is essential these are served correctly at the right times to ensure there is no detriment to the claims timescales.
Historically we have worked with two insurers for the provision of rent guarantee products as detailed below:
CoPlus – All policies purchased prior to 15th January 2020
LIM (RSA) – All policies purchased since 15th January 2020
If you are unsure which insurer underwrites your policy please contact us
Each of the above insurers has interpreted the rules and policy wordings differently and have articulated their processes in the below attachments
CoPlus have determined that Rent Guarantee claims will not be paid until section notices have expired (90 days from issue)
To make a claim
For any CoPlus policy call 0333 043 1326
For any LIM/RSA policy call 01384 377 000
Alan Boswell Group will usually take an active role in the entire claims process – but the process for a Rent Guarantee claim is different to most insurance policies. Claims made on Rent Guarantee policies will be directly with insurers – this is because there are certain processes that must be followed in set timescales. Our involvement will be at the point of escalation if the claims process is not working as expected and we will act on your behalf to ensure issues are resolved. We will, however, not be able to support frivolous claims as detailed above.