Latest News

Do I Need Landlord Insurance? And Other Insurance for Landlords

23 July 2021

Landlord insurance isn’t a legal requirement. But if you’re letting property, then adequate insurance cover is essential.

Indeed, you might soon find that you simply cannot get by without some form of landlord insurance. If you’re letting property that you own, then you most likely have a mortgage on that property.

Most mortgage providers will refuse to lend to you unless you have a home insurance policy in place. Standard home insurance policies don’t cover homes for rental activities. So you’ll have to get a dedicated landlord insurance policy either before you get your buy-to-let mortgage, or before you take on tenants.

So do you need landlord insurance?

No, not by law. But given you won’t be able to get a mortgage without adequate property insurance to cover you for rental activities, then yes: You absolutely need landlord insurance.

If You Have Tenants of Any Kind, Then You Need Landlord Insurance

What’s more, you also need landlord insurance if:

  • You’re letting property to family members.
  • You’re continuing to live in the property, but you’re renting out individual rooms to tenants.

Why? Because again, standard home insurance policies don’t cover rental situations. If you have tenants of any kind, no matter what your circumstances are, you need landlord insurance.

Also bear in mind that, if you plan on letting a property that you already own, then you’ll need written permission from your mortgage lender before you take on tenants. And once more, you’ll need this permission even if you’re letting to family members, or if you plan to continue living in the property yourself. If you don’t get permission, your mortgage lender might claim that you’re breaking the terms of your mortgage. This could put your property at risk.

Why Should I Get Landlord Insurance?

We’ve established that there’s nothing in UK law saying that landlords must get landlord insurance. But that doesn’t mean that landlords don’t have any legal obligations. The Landlord and Tenant Act 1985 specifies that landlords have a legal obligation to keep certain parts of their property “in repair and proper working order.”

This includes the structure and exterior of your property, along with the various installations for gas, water, electricity, and heating. If anything goes wrong with any part of your property, you’ll have a legal obligation to fix things as soon as you can.

If your roof caught fire and you needed a new one, would you be able to afford it? Probably not. And that’s why you need landlord insurance. It ensures that if you suffer an insured event such as a fire or flood and your property is damaged, you can continue to meet your tenants’ needs without being out of pocket.

What Does Landlord Insurance Cover?

A landlord insurance policy will cover your rental property against damages from fire, flood, and other situations. It will most likely cover you for damages resulting from burglary and vandalism. It might also cover you for accidental damage caused by tenants.

So in short, consider a landlord insurance policy to be a specialised form of home insurance, covering the property itself against damages. Your landlord insurance policy might also cover you for any loss of rent income you might suffer as a result of damages. Finally, your policy can include Property Owner’s Liability Insurance. This covers the cost of financial recompense and legal fees if someone gets injured in your property or something they own is damaged.

Learn more about what landlord insurance is, and what it covers.

What Other Insurance Do Landlords Need?

  • Landlords Home Emergency Policy – If a pipe bursts in your house, your landlord insurance policy will cover any damages it causes. However, it won’t cover the cost of fixing the plumbing. For that you’ll needs additional Landlords Home Emergency cover, which will also cover you for issues such as gas leaks and broken boilers.
  • Rent Guarantee Insurance – Your landlord insurance policy might include loss of rent insurance. This is cover for loss of rent income following property damage. Rent guarantee insurance, on the other hand, can cover you for rent defaults by your tenants. If, for whatever reason, your tenants cannot or will not pay rent, rent guarantee insurance can ensure you still receive your monthly rent payments. Your policy might also cover legal fees, should you need to take a tenant to court. Head here to learn more about Loss of Rent and Rent Guarantee Insurance.
  • Contents Cover – Your landlords insurance policy should cover your own contents within the property, including your own furniture, soft furnishings, fixtures and appliances. It won’t cover your tenants’ property, though. For that, your tenants will need dedicated tenants’ contents insurance.

How Much Does Landlords Insurance Cost?

The price of your landlords insurance policy will depend on a few factors, including the size and age of your property, the building’s reinstatement cost, and several other risk factors. You’ll pay more for your cover if your property is on a flood plain, for example. Getting add-ons for your policy, such as rent guarantee insurance, will also push up the price of your policy.

At Hazelton Mountford, we can tailor a comprehensive landlord insurance policy for you that’ll meet all your needs as a landlord. We can source competitive premiums from some of the UK’s most prestigious insurers. What’s more, our dedicated property team will always be on-hand to provide any support or guidance you might need. Get in touch for more information.