If you rent a property to any tenant, you must be protected in the event that they mistreat the property, are unable to pay rent, refuse eviction, or create a difficult living situation for neighbours and the surrounding community. When this happens, your landlord protection insurance policy will cover you for any problems that arise as a result of your tenant’s behaviour.
We have previously looked at landlord buildings and content insurance, and the importance of having your bricks and mortar, and everything within, protected from theft, damage or total loss. However, some of a landlord’s biggest stresses can come from the tenant.
As part of your landlord insurance, you will most likely have buildings and contents cover for your property and the belongings situated within. However, there are a number of features you can include in your policy that are purely tenant-related. These include:
Loss of Rent Cover
If there is a situation that leaves your rental property uninhabitable (structural issues, fire damage, storm damage or flooding, for example), your tenants will need to move out. During this time, they will not be expected to pay rent which can leave you significantly out of pocket.
With rent protection insurance, you will receive the income you need to carry on running smoothly while your property is repaired.
Tenant Default Cover
If your tenant’s circumstances change unexpectedly, leaving them unable to pay rent – such as a job loss or long-term illness, tenant default cover will pay you what they owe. This offers guaranteed rent for landlords when the tenant is in two months’ worth of arrears.
Provided you performed adequate credit checks and the time of renting, you are able to add this feature to most landlord insurance policies.
Landlord Emergency Repairs Cover
It is your responsibility to make sure your rental property is a habitable environment, so any issues that make it less than comfortable should be sorted as quickly as possible.
Plumbing and heating problems, pest infestations, power supply issues, and security of doors and windows are all issues that require emergency attention, and call outs can be pricey. With landlord emergency cover insurance, those costs will be covered.
Accidental Damage Cover
Any number of small accidents can happen in the course of daily life – from spilling wine of the sofa, to a DIY job causing more harm than good. Although it doesn’t cover you against general wear and tear, damage insurance for a rental property will cover the cost of repairing these smaller accidents, which can often be expensive.
Alternative Accommodation Insurance
If your property is uninhabitable for any reason, and your tenancy agreement says you will provide it, you will have to pay the cost of alternative accommodation for your tenants. Your policy will only pay out, however, if the tenant has to leave because of an event that has already been insured against (such as a fire, or storm damage).