What is Landlord Insurance?
It’s been another difficult year for landlords and the recent Autumn Budget has led to mixed opinions about the rental market. As landlords reassess their property investments, the value of landlord insurance cannot be understated. So, what is Landlord Insurance and how does it provide cover? In this blog, we explain how it works and why you should consider insuring your property portfolio.
In recent times, tenant demand has been recorded as 32% higher than 2019, but the supply of rented homes is down by 38%. Despite the applicable Capital Gains Tax rate for landlords remaining unchanged, Stamp Duty has increased from 3% to 5% for buying additional properties. It’s thought that many landlords may choose to hold onto their current portfolios, rather than selling up. If you rent a property, a Landlord Insurance policy will help you protect your investment.
What does Landlord Insurance cover?
As well as buildings insurance and property owner’s liability insurance, it’s important for landlords to insure their rental properties against other risks. Landlord Insurance can cover tenant-related damage, unpaid rent, and loss of rental income due to property conditions or between-tenant vacancies. It can also cover legal expenses, boiler repairs and maintenance.
When you own a building, but you are not the main occupant, this can create complications when certain situations arise such as a burst pipe. Although standard house insurance would usually cover you for a flood and pay for alternative accommodation, this would not apply to tenants. Landlord Insurance can provide cover if the property becomes uninhabitable.
If you are a landlord, then it’s important to insure your property portfolio against both accidental and intentional damage caused by tenants. Landlord Insurance policies usually include a level of public liability, which is important when you are renting to the general public. Public liability cover enables you to protect your property for accidents caused by tenants.
Although Landlord Insurance isn’t mandatory, it is recommended as a way of protecting rental properties. However, you are usually required to have buildings insurance as a condition on your buy-to-let mortgage.
Insurance for landlords
Depending on the policy, Landlord Insurance can give you peace of mind that your property will be covered if your tenant doesn’t pay rent. Some policies cover for loss of rental income caused by tenancy gaps. It can also provide you with a vital financial buffer to pay for any damage, whether intentional or accidental.
At Bubble Finance Hub, we regularly advise landlords when it comes to insuring their rental properties. Landlord Insurance covers you for risks not usually covered by building and contents insurance. Our insurance team will find you a policy aligned to your needs and your portfolio size. We will explain the policy benefits, as well as the terms and conditions. If you are looking for a buy-to-let mortgage, then please speak to our mortgage team.
For advice on Buy-to-Let mortgages and Landlord Insurance, please get in touch to book an appointment.
As with all insurance policies, conditions and exclusions will apply.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Thank you for reading our blog, What is Landlord Insurance?
Bubble Finance Hub