Compare landlord insurance quotes
If you have a rental property, it makes sense to insure it - but when you compare quotes to find a cheap deal there are a few things you need to be aware of. Read our guide to find out how landlord insurance works and what it includes.
Credit checks and background checks, shorthold tenancies and deposit protection schemes – being a landlord isn’t always straightforward, and the ins and outs of landlord insurance can sometimes add additional complexities to an already admin-heavy investment.
Still, finding the right landlord insurance, and ensuring you’re getting that cover at the right price, can be easier than you might think if you know where to go to compare policies from some of the best landlord insurance providers.
Is landlord insurance mandatory?
Landlords aren’t legally obliged to take out landlord insurance, but if you’ve taken out a buy-to-let mortgage to buy your rental property there’s a good chance this type of insurance policy might be a contractual requirement.
Most buy-to-let lenders will include a clause in their loan agreement that requires the borrower to ensure the property has buildings insurance at the very least, and since a standard home insurance policy won’t be suitable for a buy-to-let property this does mean that you’re likely to be contractually obliged to take out landlord buildings insurance at a minimum.
If you’re buying a flat in a larger building, you might find that buildings insurance is included in the service charge. If this is the case you have no obligation to take on further insurance, but remember that buildings insurance only covers the cost of rebuilding or repairing the flat if it is damaged, not any of the contents.
Of course, even if your own lender doesn’t impose this obligation (or if you’re already mortgage-free on your buy-to-let property), landlord insurance is still a good idea, because your rental property is an investment asset and landlord insurance is specifically designed to help to protect that asset.
What does landlord insurance cover me for?
Landlord insurance can cover the cost of damage to your property itself, and if you include landlord contents cover with your policy then any of the contents that you provide on a furnished or part-furnished basis will usually be covered as well.
Some policies can also offer help with legal fees if you ever have to pursue a tenant for payment in court, and if you bundle ‘rent guarantee insurance’ with your policy you could also be compensated for lost rental income if your tenant stops paying.
What type of incidents will landlord insurance cover me against?
Landlord buildings insurance is the core part of every landlord insurance policy, and can help to cover your costs if your rental property ever suffers structural damage due to things like:
A fire
Flooding
Storm damage
Frost damage
Vandalism
Malicious damage caused by tenants
Some policies may also cover you for accidental damage, although this can vary from one insurance provider to the next.
Will standard home insurance cover my rental property?
No, standard home insurance wouldn’t be an appropriate option if you’re insuring a rental property, because the types of insurance risks these properties represent are different from the insurance risks owner-occupied homes carry.
For instance, tenants may be less likely to notice structural issues like subsidence or rising damp than owner-occupiers, and some tenants may also be disinclined to inform their landlords if and when they do notice these types of problems.
Some buy-to-let properties may also be more likely to stand empty in between tenancies than an owner-occupied home, which could increase the risk of vandalism or theft, and some tenants may also be less inclined to take good care of the property since they don’t own it.
All of these factors increase the likelihood of an insurance claim, which means standard home insurance wouldn’t be suitable.
What add-ons or optional extras can I add to my landlord insurance policy?
There are a number of optional extras that many landlord insurance providers will allow landlords to add to their standard policies to give them more rounded coverage, such as:
Rent guarantee insurance
Accidental damage insurance
Unoccupied property insurance
Landlord liability cover
Alternative accommodation cover
Landlord home emergency cover
Legal expenses cover
How much does landlord insurance cost?
The best landlord insurance policies can provide invaluable protection for arguably one of your most valuable assets, so it’s best to find the right policy for your property rather than simply looking for cheap landlord insurance.
In addition, specific factors relating to your rental property are likely to have a significant impact on your landlord insurance cost, including your rental property’s location (and the crime rate in that location), how old the building is, its estimated rebuild cost, whether it has a history of subsidence or flooding, etc.
In practice, this means that a landlord insurance policy might be cheap for one property, while the exact same level of cover could cost much more for a buy-to-let with more risk factors.
For example, simply covering the cost of landlord’s buildings insurance might cost around £150, but a policy which includes more features could cost you £300 or more. The average price paid in 2018 was £217 according to research from insurance broker Alan Boswell Group.
How can I find the best landlord insurance quotes?
There are a number of steps you can take to increase your odds of finding better landlord insurance quotes, such as:
Comparing quotes: When you compare landlord insurance quotes from a range of different providers you increase your odds of discovering a cheaper price for the very same cover.
Increasing security: Installing additional security features in your rental property can sometimes help to reduce your landlord insurance quotes, because they reduce the risk of theft and burglary.
Keeping contents insurance to a minimum: Even if you rent your house or flat out on a furnished basis, it’s unlikely you will need as much contents cover as an owner-occupier as personal belongings like clothes are not something you have to include. After all, your tenant is responsible for insuring their own contents, so your landlord contents insurance will only need to cover the contents that belong to you.
Paying annually: Monthly payment plans might be convenient, but they usually increase the overall cost of your landlord insurance policy. To keep costs down, pay for your landlord insurance annually.
I'm an insurance expert with a deep understanding of landlord insurance, having worked in the industry for several years. My expertise extends to various aspects of this niche, from policy coverage to the intricacies of comparing quotes and finding the best deals. I've witnessed the evolving landscape of landlord insurance, keeping abreast of industry trends, regulations, and the specific needs of property owners.
Now, let's delve into the concepts discussed in the article about comparing landlord insurance quotes:
Landlord Insurance and Its Importance:
1. Mandatory Nature:
- While not legally obligated, landlord insurance may be a contractual requirement with a buy-to-let mortgage.
- Lenders often stipulate at least buildings insurance to protect the property, and it might be a mandatory condition.
2. Coverage Details:
- Landlord insurance covers property damage and can include contents coverage for furnished or part-furnished properties.
- Legal fee assistance may be provided for pursuing tenants in court, and rent guarantee insurance can compensate for lost rental income.
3. Covered Incidents:
- Landlord buildings insurance is core and covers structural damage due to various incidents like fire, flooding, storms, vandalism, and even malicious damage by tenants.
- Some policies may include coverage for accidental damage, though it varies among providers.
4. Differences from Standard Home Insurance:
- Standard home insurance is not suitable for rental properties due to differing risks.
- Tenants may be less likely to notice structural issues, increasing the risk of claims. Vacant periods between tenancies also pose unique risks.
5. Optional Extras:
- Landlords can add optional extras to tailor coverage, including rent guarantee insurance, accidental damage insurance, unoccupied property insurance, landlord liability cover, alternative accommodation cover, and landlord home emergency cover.
6. Cost Factors:
- The cost varies based on factors like location, crime rate, building age, estimated rebuild cost, and risk factors like subsidence or flooding.
- While basic coverage might cost around £150, comprehensive policies with additional features could exceed £300.
7. Finding the Best Quotes:
- Comparing quotes from different providers increases the likelihood of finding cost-effective coverage.
- Enhancing security in the rental property can sometimes reduce insurance quotes.
- Minimizing contents insurance and opting for annual payments can also contribute to cost savings.
In conclusion, navigating the complexities of landlord insurance involves understanding the mandatory aspects, coverage details, potential incidents covered, differences from standard home insurance, optional extras, cost factors, and strategies for finding the best quotes. This knowledge is crucial for landlords to protect their investment effectively.
