Rental Property Insurance

This article has been written for Landlords who want to make sure that their rental property is adequately insured. If you are a renter who needs to insure the contents of their home, you might benefit from reading Home Insurance Money Saving Tips.

Renting a property out, entails assuming a number of risks. Many  Landlords only buy general buildings cover, leaving them exposed to a number of potential problems. We recommend going to a broker than can explain the different kinds of insurance that is available for Landlords. If you are insuring multiple rental properties we suggest you insure it all through one company, to make the most of the discounts they should give you.

Below we list the different insurance covers available for landlords:

Property Owners Liability

This covers you against legal liability from death, injury or damage to anyone in or around your property. This includes tenants as well as visitors. The risk of this happening is low but the costs can be very high. I recommend you get cover of around £5 million.

Buildings Cover

The most important thing with buildings cover is, to make sure that the insurance covers the full rebuild cost of the buildings. You should also make sure that the policy covers all the most likely risks such as burglary and theft, bursts pipes and water leaks, fire, smoke, subsidence, vehicle impact, storm and flood,  aircraft damage, explosion, lightening and malicious damage.

Contents Cover

The amount of contents cover that you need depends on whether you rent the property furnished or unfurnished. Again you should purchase enough cover to replace everything.

Rent Guarantee Insurance

This covers you against possible non payment of rent. Some Landlords prefer not to buy this cover, but if you need to get the payment in order to pay the mortgage on the property, you should purchase this insurance.

Even good renters sometimes default on their payments. Typical reasons are unexpected breakups and redudancies.

Typically the insurance costs around 5% of the rent money. A landlord with a monthly rental income of £800 per month would pay around £480 per year for this cover.

Legal Expense Insurance

This covers you if you need to go to the courts to put out a bad tenant. For a small fee you can get up £50,000 of legal cover.

Even if you are covered you should always do a thorough background check, specifically checking the potential tenants references and credit history.

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