Rent Guarantee Insurance – is it worth it?

by Readers Question

13:51 PM, 28th October 2020
About a month ago

Rent Guarantee Insurance – is it worth it?

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Rent Guarantee Insurance – is it worth it?

I have a 2 bed house that I’ve just refurbed after a family did a lot of damage to it and ran up rent arrears. I’m now debating whether to holiday let it or family let again.

However, I’m reluctant to family let again without rent guarantee insurance.

I’ve never taken this out as I’m sceptical of insurance companies paying out.

Just wondered if members had any good bad experiences with rent guarantee, and any changes or claims since the government Covid-19 restrictions?

Many thanks

Tara


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Comments

Ian Simpson

21:06 PM, 31st October 2020
About a month ago

Reply to the comment left by Paul Shears at 31/10/2020 - 19:25
Thanks Paul

Yes I had thought to request a copy of the policy detail, but had not requested it as yet. Might be worth a go, though Romans may, of course, edit the policy before passing it over...!!

Alison King

23:59 PM, 31st October 2020
About a month ago

Personally I've never thought it was worth it. The insurance companies have to make a profit. If you de risk it enough to satisfy the insurance company you de risk it enough for yourself.

alocjtoi

1:11 AM, 1st November 2020
About a month ago

I've had an RGI bought through OpenRent for something like £87 per year and it was absolutely worth it when needed. It was a bit slow to kick in (perfectly within the terms) and I had to deal with some extra paperwork, but I got all the rent due and the tenants out of the property in 9 months (all legal matters taken care of by the insurance). Obviously this was pre-covid and this kind of insurance is no longer available on OpenRent, but if something similar can still be arranged it's a no-brainer.

Badger

11:21 AM, 1st November 2020
About a month ago

Reply to the comment left by alocjtoi at 01/11/2020 - 01:11
Letting Supermarket are still offering RGI and they say that claims will not be stymied by the "Covid" excuse.

Ian Simpson

11:43 AM, 1st November 2020
About a month ago

Yes, though the only proviso to that is that Lettings Supermarket must have found and previously referenced the tenant themselves, it is not available for existing tenants/tenancies arranged outside of Lettings Supermarket. So it is of no use if you wanted to take out cover for your existing portfolio.

Ian Simpson

16:50 PM, 1st November 2020
About a month ago

Reply to the comment left by Ian Simpson at 01/11/2020 - 11:43
Apologies for the long post - this is the Romans Exclusions clause: 7.2.9 is the closest it gets, but no mention of "Pandemic" or "Pestilence" or "Covid"...
7 Exclusions
Romans shall not be liable to make any payment under this
Premier Service in respect of rental income arrears, legal
expenses, alternative accommodation expenses or whatever:
7.1 where a Landlord:
7.1.1 has failed to comply with his own contractual and statutory
obligations;
7.1.2 has agreed in whole or in part to any breaches of tenants
covenants under the terms of Tenancy Agreement;
7.1.3 has commenced negotiations with a tenant for the
purchase of the Property whether or not such purchase is
completed,
7.2 in respect of or arising from or related to:
7.2.1 any incident reported to Romans more than two calendar
months after the date that it first became known to the
Landlord;
7.2.2 fees, costs and disbursements incurred without the written
agreement of Romans ;
7.2.3 any dispute between Romans and a Landlord
7.2.4 rent registration reviews, lease holding franchisement or
any matter which in the first instance fall within the
jurisdiction of the rent rates or land tribunals or rent
officers;
7.2.5 disputes of whatever nature with persons other than the
Tenant of the Property or a person in unauthorised
occupation;
7.2.6 the compulsory purchase, confiscation, nationalisation,
requisition, destruction or restriction or control placed on
or damage to any property or the actual planned or
proposed construction, closure, adaptation or repair of
roads or bridges or the actual planned proposed
construction, demolition or adaptation of buildings,
housing or other works by or under the order of any
intergovernmental, governmental, public or local authority;
7.2.7 mining, subsidence, or heave;
7.2.8 ionising, radiations or contamination by radioactivity from
any eradiated nuclear fuel or from any nuclear waste from
the combustion of nuclear fuel or the radioactive toxic
The Romans Group (UK) Limited • Registered Address: Crowthorne House, Nine
Mile Ride, Wokingham RG40 3GZ • Registered in England 2161874 VAT 757216127
exposure or other hazardous properties of any exposure
to nuclear energy or nuclear component thereof;
7.2.9 events which are a consequence of war, invasion, act
of foreign enemy, terrorism, hostilities (brackets whether
war was declared or not) civil was, rebellion, revolution,
insurrection or military or usurped power, strikes, lockouts,
all worker occupations;
7.2.10 any liability whatsoever for further liquidated costs
following a re-letting of the Property;
7.2.11 any service charges relating to the Property;
7.2.12 any liability arising from the supply of electricity, gas, water,
other utilities and telephone services unless the respective
public utility has been instructed of the change of
occupancy to a tenant;
7.2.13 liability arising in the common law full mesne profit;
7.2.14 the Landlords personal or incidental expenses shall not
be an allowable deduction from deposit monies held
where this prejudices Romans position in recovery of rental
income arrears or dilapidations;
7.2.15 disputes in respects of dilapidations not exceeding £500 in
excess of the deposit held by Romans on behalf of the
Landlord to whom the Romans Guarantee applies;
7.2.16 any harassment of a tenant;
7.2.17 the defence of the Landlord in civil proceedings due to
a) bodily injury, illness, disease or death, b) loss,
destruction or damage of or to the property, c) alleged
breach of any professional duty, d) any tortuous liability;
7.2.18 fines or other penalties imposed by a court;
7.2.19 any defect in the condition of the Property which
pre-exists the date of this agreement or any gradually
operating cause which pre-exists the date of this
agreement;
7.2.20 any defect in a Landlords title to any of the property,
7.3 where the Landlord:
7.3.1 pursues or defends a case without Romans consent or
contrary to manner advised by Romans appointed
solicitor;
7.3.2 fails to give property instruction when required by the
appointed solicitor or counsel;
7.3.3 is responsible for delay which in the reasonable opinion of
Romans is prejudicial to the prospects of success;
7.3.4 fails to take all reasonable steps to avoid or prevent claims
or legal proceedings;
7.3.5 fails to maintain in full force and effect during the Tenancy
Agreement buildings insurance on the Property covering
the standard range of perils;
7.3.6 fails to pay instalments in respect of a mortgage on the
property except where such failure to pay instalments
occurred after the tenant first failed to pay the rental
income due to the Landlord;
7.3.7 instructs a solicitor other than Romans appointed solicitor.

Paul Shears

17:31 PM, 1st November 2020
About a month ago

Wow! That is a lot of caveats!

Badger

18:18 PM, 1st November 2020
About a month ago

Reply to the comment left by Ian Simpson at 01/11/2020 - 16:50
Good grief!

EvolutionBlogger

16:34 PM, 22nd November 2020
About 2 weeks ago

I have rental guarantee insurance for all of my residential tenants. I've only had to claim twice, but have been succesful both times.

For me, Rental Guaranete Insurance is a no brainer and every landlord should use it. In my experience, the average price of insurance is 1% of the rent

Just make sure you read the details of what is and isn't covered. And make sure you disclose everything as accurately as possible.

Insurance companies in the UK are heavily regulated. If your Insurance company is being unreasonable, then you can complain

Paul Shears

16:57 PM, 22nd November 2020
About 2 weeks ago

Reply to the comment left by EvolutionBlogger at 22/11/2020 - 16:34Who is your RGI with please?

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