What does landlord insurance cover and why do you need it?

What does landlord insurance cover and why do you need it?

When you rent out a property, you’re also taking on a certain amount of risk – and landlord insurance cover helps to negate that.

Most standard landlord insurance policies protect your property against major damage.

But there are also many additional levels of protection you can add to your policy, giving you further peace of mind.


What is landlord insurance?

Landlord insurance is the policy that protects your rental property from damage or destruction in the event of a fire or flood.

In that sense, it’s similar to a standard buildings insurance policy you might have on your own home.

But renting out a property to tenants comes with additional risk, so landlord insurance policies cover you for many other eventualities, too.


Do I need landlord insurance?

There’s no legal requirement for you have to a landlord insurance policy in place when renting your property to tenants.

But if you have a buy-to-let or House in Multiple Occupation (HMO) mortgage secured on the property, your lender will almost certainly insist you take out at least a standard landlord insurance policy covering the building.


What other things does a landlord insurance policy cover?

As well as protection for your rental property against fire, flooding or other destruction, a landlord insurance policy can also cover other risks associated with lettings.

Those might include:

• Contents insurance

• Fixtures and fittings insurance

• Accidental damage insurance

• Tenant liability insurance

• Legal expenses insurance

• Boiler breakdown cover


Landlord contents insurance

If you’re renting out your property on a furnished basis, landlord contents insurance protects your items against damage from fire and flooding, as well as theft.

Your tenants’ belongings won’t be covered by your contents policy, however.


Fixtures and fittings insurance

Fixtures and fittings in your rental property are usually covered by the main buildings insurance element of your landlord policy.

For the purposes of insurance, fixtures and fittings are items that aren’t easily removed from your property, including bathroom suites, carpets, internal doors, integrated fridge freezers, ovens and hobs.

Fixtures and fittings insurance is generally used by landlords letting leasehold flats and apartments, where their property’s fixtures and fittings aren’t covered by the freeholder’s buildings insurance policy.


Accidental damage insurance

Accidental damage insurance covers your costs if you need to repair or replace anything in your rental property damaged by accident.

That might include:

• Stains on carpets

• Holes in walls

• Broken windows

Accidental damage doesn’t cover you for wear and tear, or if your tenants damage your property on purpose.

Policies generally don’t cover damage caused by animals or poor workmanship by tradespeople, either.


Tenant liability insurance

Tenant liability insurance is often offered as part of a standard landlord insurance policy – but you should always check.

This element of landlord insurance covers you should a tenant, or visitor to your rental property, injure themselves and you’re held responsible.

Trips on loose carpet or flooring and trailing wires are among the most common causes of personal injury claims from tenants.

Tenant liability insurance, however, covers your costs arising from any claim.


Legal expenses insurance

Legal expenses insurance can cover your costs should you need to evict a tenant through the court process.

This element of landlord insurance is sometimes included automatically, so always check your policy.


Boiler breakdown cover

Optional cover for boiler breakdowns is often available as part of your landlord insurance policy.

Boiler breakdowns can be expensive and inconvenient for your tenants, so boiler breakdown cover helps to ensure your costs are covered and repairs are carried out in good time.


Does landlord insurance cover unpaid rent?

Tenant default insurance is available to add to most landlord insurance policies.

This means your rental income is covered should you tenants fall into rent arrears.

However, there are often limits to the amount of rent covered and most policies will require proof of credit and background checks on your tenants.


How much is landlord insurance?

The cost of your landlord insurance policy will depend on the type of property you’re letting out, how much it’s worth and the amount of cover you require.

Insurers will work out how likely you are to make a claim and the potential costs involved, meaning the cost of landlord insurance policies can vary depending on your personal circumstances.


Enhanced protection from your managing agent

Here at Martin & Co, we offer landlords a Premium Managed service for their rental properties – and this includes additional protection.

The Premium Managed tier of our property management package includes:

• Rental income protection

• Cover against serious tenancy breaches

• Legal expenses cover

Contact your local branch to find out more.


Further reading…

Allowing pets in your rental property – should you or shouldn’t you?

Everything you need to know about electrical safety compliance

Your complete guide to landlord taxes