With more and more people deciding to invest in properties, many are confused as to what landlord insurance is and why they require it. Read on to know the ins and outs of landlord insurance.
What is Landlord insurance?
Picture landlord insurance as a premium home insurance, click here for our guide on it, to cover all unexpected costs like tenants not paying rent or the damage to the property.
Do I have to have landlord insurance to rent?
Legally, you do not need to get landlord insurance to rent out a property, but it is advised if you want to be protected against the worst. If you only take standard home insurance, they won’t cover you. This is because insurance companies see that the renters may be very different to you and therefore will not be able to make a claim.
What does Landlord Insurance cover?
Landlord insurance covers, as mentioned above, all the things standard home insurance would cover plus:
- Loss of rent
- Malicious damage or theft by tenants
- Legal expenses, if you decide to take action against the tenants
- Public liability
- Eviction of squatters – when a tenant refuses to leave.
How much will it cost?
The price of your insurance will depend on who your tenants are and what they do. For example, if you were to rent out your property to two university students, it would cost more than if you were to rent out to a retired couple. This is because they see the students as higher risk tenants, as they earn less money and are more likely to not pay their rent.
What safety features are required in my property?
By law, you are required to have smoke and carbon monoxide alarms on every floor, and test them frequently. You also need to have electric installation certificates and carry out any necessary repairs that are required. You need to make sure to check the gas and electric equipment often, as invalid or unsafe equipment can lead to your insurance policy being invalidated. You can then be taken to court by the tenants and you will not be covered.
That’s it, thanks for reading our explanation to landlord insurance. Remember to find the best deals according to your needs. Check out our other blogs to learn all about insurance.