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16:09 PM, 22nd February 2016, About 8 years ago 8
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Here at Property118 we want to make things as simple and straightforward as possible. That’s why we GUARANTEE to beat any like for like Landlord Insurance policy. But what is Landlord Insurance and why is it important? Using the same straightforward approach this is your guide to what Landlord Insurance is using layman terms.
Definition of Landlord Insurance
Landlord Insurance is a financial instrument designed to protect your property asset. It means if you have a disaster or problem with the property then you can make a claim on the insurance and it shall pay for the fix/repairs. Essentially you pay for a promise from the insurer to pay for costs/repairs if you need them.
There are terms and conditions which you will agree to when you make a contract for insurance. If you break any of them, regardless of how irrelevant you may think they are, it will be a breach of contract and the insurer can refuse to pay out – because you were fraudulent on the agreement and therefore it is null and void. You can see the sense of this. If you made an agreement with someone and they lied or deceived you and didn’t honour the terms of the agreement, why should you honour the terms of the agreement?
So if you feel tempted to say the property does have deadlocks when it doesn’t, you should think again. That’s easy for an insurer to check and if they find a problem you’ll have insurance refused. If you say you have working tenants but they are actually DSS, then that will be found out as well. And there’s no point paying for insurance if it will become void when you need it. Tell the truth and you will be fine.
Buildings Insurance
You probably have buildings insurance for your own residential home where you live. You specify a rebuild value of the property and in the worst case scenario if it burns to the ground it will be rebuilt by the insurer. You pay the excess you agreed.
Landlord Insurance works in exactly the same way. You specify the rebuild value of the property. You agree an excess, normally between £100-£250. You answer questions on build, security and tenants. Then you are offered a price and terms.
Contents Insurance
Most properties are let unfurnished. But some will be let with landlord contents in place. Sofas, televisions, beds, that sort of thing. You may wish to insure these. This works exactly the same as your residential contents insurance. You need to note items, keep receipts if you can, photograph them if possible and do all you can to ensure you can prove ownership and value.
Landlord Contents Insurance tends to be low value – less than £10,000 cover needed in most cases. But it will add cost to your annual policy.
The other benefit of Landlords Contents Insurance is if you let out a flat or apartment that is part of a block owned by a landlord. The block will be insured by the landlord, not you. If you wish to add public liability to your property, often an effective way to do this is via Contents Insurance.
Block Landlord Insurance and what it means for you
If you own a leasehold flat then you will have a landlord in charge of the block who will supply the buildings insurance. You cannot double insure the property, that is pointless and will cost you money for no benefit. Ultimately you will be found out in a claim and could face action for fraud. Ignorance is not an excuse.
You can buy Landlords Contents Insurance and that allows you to add liability cover, Rent Guarantee Insurance, Landlord Emergency Insurance, Legal Expenses Insurance or even Boiler Cover. What you can add on will depend on the insurer you are talking to.
Many landlords will buy a minimum of £5000 Landlord Contents Insurance in order to access the liability cover alone – which is normally providing around £1-million cover.
Is Landlord Insurance a commercial product?
Yes, Landlord Insurance is a commercial product. For all intents and purposes that should make little difference to you. It acts similar to the retail insurance you are used to buying for your own home, car, travel etc.
But this is a key difference with a residential home policy. Let property is treated different from residential and is classed as commercial. You cannot insure a let property on a normal home residential policy. If you do, it will be refused if you make a claim.
What is typical Landlord Insurance?
Typical Landlord Insurance is for a freehold property with a rebuild value of around £100,000 – £200,000. It is buildings insurance only. It costs around £140 in the UK on average in 2016. But there is no real typical, it will all depend on your property, postcode, tenants, excess etc.
Does Landlord Insurance allow for vacancy or void periods?
The short answer is yes – normally 30-days but some policies will allow up to 60-days. It’s normal that vacancy cover will not apply to a new policy when you buy it. It only kicks in when a tenant moves out during the course of the policy.
If you need insurance for a property that is empty when you buy it, then you need Unoccupied Property Insurance for the time before you tenants move in. The Property Insurer is a Property118 partner and can save you money if you need this insurance and you can then switch to landlord insurance when ready.
How do you make a claim on Landlord Insurance?
You claim on Landlord Insurance by following the details in the policy schedule supplied. It will give you the steps you need to take. Once you lodge a claim, things tend to happen quickly. Don’t try to claim for more than you are due, they will find out and that is not good news for you. If they deem you have been fraudulent then they could refuse you insurance in the future which is a big problem and potentially very expensive.
Will making a claim increase my cost of insurance in the future?
In theory the answer is yes as you are more of a risk. Any claim you make on insurance may be asked for when applying for new policies. If you make a claim then tell your insurer when applying for the policy.
In reality, competition is so fierce for Landlord Insurance that you can often get Landlord Insurance after a claim for similar prices as previously.
Can you get Landlord Insurance for a portfolio of properties?
Yes, simply use the quote form here on Property118. Often, discounts apply for larger size portfolios due to bulk buying power. Our biggest portfolio is 600+ properties.
What about Landlord Insurance and your BTL mortgage?
If you have a BTL mortgage then you must put Landlord Insurance in place. If you don’t then you are in breach of the terms and could have the loan called in.
How does Property118 Landlord Insurance work?
This is straightforward. We partner with the best supplier that offers low prices and comprehensive policies. That means from time to time we may change partner, but right now we have stayed with Discount Insurance for two years and they continue to impress. This London broker has agreed to offer a price guarantee on like for like Landlord Insurance to Property118 members. It’s not an offer you’ll come across easily elsewhere.
My own let properties and the partners of Property118 are all insured through this arrangement – we put our money where our mouths are.
They have an excellent 4 out of 5 stars on Trustpilot and have helped hundreds of Property 118 landlords save money over the last two years. We receive weekly thank you emails from landlords on the money saved and service levels delivered.
So go through the Property118 quote and buy system or fill in the form here. You will be contacted quickly and we are sure you will be pleased with the price and policy delivery.
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Neil Patterson
9:30 AM, 23rd February 2016, About 8 years ago
Thank you Jason - very useful 🙂
Alan Cook
10:31 AM, 23rd February 2016, About 8 years ago
Thanks for the useful insurance information, however you need to be careful making the claim that they will beat any like for like quote.
I have taken out landlords insurance on several of my properties however I had one property that was flooded in 2007 after discussion with the agent we agreed we would leave the quote for that property until the policy was due for renewal which was this month.
I made two calls to the company to ask for a quote and in keeping with your advice here was clear about the claim for flood damage in 2007, I was advised that the underwriters would need to be contacted prior to providing a quote, I accepted that, however after a week no one had called back to I called again and was informed that this time I was taking to the manager and he would make sure someone for back to me.
I am still waiting for that call, so not surprisingly I have renewed the insurance with my old company.
Maybe the way in which they can substantiate their claim for beating like for like quotes when that is impossible is not to quote at all.
Just an observation.
Jason McClean - The Home Insurer
11:36 AM, 23rd February 2016, About 8 years ago
Reply to the comment left by "Alan Cook" at "23/02/2016 - 10:31":
Hi Alan
It's true that if you have a special circumstance it may be difficult for like for like cover to be applied, but this is very rare as our partner Discount Insurance has almost full market coverage. In this case, it looks like Discount has not contacted you back which is a dropped ball for sure. I have spoken with the MD and they are looking to speak with you urgently to resolve and hopefully provide you with the insurance you need.
If they cannot for whatever reason satisfy you, please come back to me and I can sort you out with flood insurance directly. Via http://www.thepropertyinsurer.co.uk we can insure any property with any circumstance in the UK and we have around 50 providers on our books. My first and most important aim is to make sure you get the right insurance and at the right price.
Please call Discount on 0800-612-5764 if you can, or alternatively, if they can find you by your name, they will contact you.
Best
Jason McClean
Neil Patterson
11:58 AM, 23rd February 2016, About 8 years ago
That is why we have Jason as our partner 🙂
If you have any questions or problems let us know info@property118.com as he always looks after P118 readers.
Mark, Mike and myself all use Discount and they have been awesome, but Jason has all the contacts if you need something more specialist.
Alan Cook
12:06 PM, 23rd February 2016, About 8 years ago
Hi, thanks for your response, and I fully understand that flooding is exception. I feel I gave them every opportunity to get a quote to me, and although I welcome your input I have had no choice now but to renew the insurance on the property as the policy was due on 19/02.
Next year it will be 10 years since the flood so hopefully it will be possible to get several quotes for insurance, I will no doubt include them in that process.
Alan
Paul Lucke
1:16 AM, 24th February 2016, About 8 years ago
Re: "Block Landlord Insurance and what it means for you"
"If you own a leasehold flat then you will have a landlord in charge of the block who will supply the buildings insurance. You cannot double insure the property, that is pointless and will cost you money for no benefit. Ultimately you will be found out in a claim and could face action for fraud. Ignorance is not an excuse."
My landlord has an excess of £250 on any building insurance claim. This means that a problem like a water leak from the flat above which costs perhaps £450 to repair and redecorate the fabric of my flat will cost me £250. Why can't I buy insurance cover with a £50 excess to cover the inadequate excess provided by my landlord? In what sense is that double insurance or fraudulent?
Jason McClean - The Home Insurer
8:15 AM, 24th February 2016, About 8 years ago
Hi Paul
Only the landlord can insure the building and he is the only one that can. If you try to insure your part of the building, if you ever made a claim yours would be rejected and it would revert to the landlord's insurance. The insurers have fraud departments and claims investigators just for this sort of thing.
Have a chat with your landlord and see if he can implement a better insurance policy that works for you. After all, you are his customer/client and he should want to keep you happy. Excess reduction normally is does not attract a big hike in rates, especially if going from say £250 - £150.
Hope this helps!
Jason
20:25 PM, 2nd March 2016, About 8 years ago
can a tenant claim against landlords insurance for injuries from fall cleaning gutters
tenancy agreement not helpful as it has conflicting clauses
1 clause states tenants responsibility to clean gutters
2 clause states it is landlords responsibility to clean gutters
my neighbour is going to sue landlord on basis of the conflicting causes what is his chances of succeeding if any.he thinks he has a good chance .