If you have never been a landlord before, you may be surprised to learn that a typical home insurance policy may not be adequate for your buy to let property. This is because insurers may assume that there is more risk attached to a let property than an owner occupied one. Accordingly, you may wish to consider landlord property cover.
What may be included?
Firstly, buy to let insurance may typically cover damage to the structure of the building caused by a number of risks. These may include disasters related to extreme weather (e.g. storms), or may also relate to accidents like fires.
You may wish to double check whether malicious damage caused by the tenants themselves is included in your landlord property cover. Some policies cover this, others do not. Likewise, you may wish to check whether the landlords insurance policy offers any support for taking such troublesome tenants to court to deal with this kind of behaviour. Such court actions may be costly and if your policy does cover this eventuality, you may be very grateful should the occasion arise!
To turn this situation on its head, what if your tenants were to take you to court? Some policies may include a “fighting fund” to defend such action, in addition to the practical (and moral) support that you may need in this situation. Whilst this may sound like a nightmare scenario, you may need to consider these risks in the lettings business.
Next, you may wish to check whether the policy includes any cover for contents. Your needs here may depend on what kind of tenant you deal with, and some providers may offer let property insurance that may give different levels of cover depending on who is in occupation. For example, if you deal with unfurnished houses where families provide their own furniture and bits and pieces, this may be of less concern than if you offer student accommodation, where kitchen equipment and bedroom furniture may be provided.
Buy to let cover may also include loss of rent while the property is being fixed to repair damage caused by an insured risk, but landlord property cover may not typically include loss of rent where the tenant has simply proved to be unable to pay, or where they have left without giving proper notice. Likewise, if you are looking for insurance that may cover other voids, you may need to consider a different sort of cover.