Being a landlord means you bear the responsibility of protecting your tenanted property, be it a small holiday let or a multi-bedroom house, against anything that might incur damage and subsequent financial losses. On the other hand, your tenant carries the responsibility of protecting their belongings that reside at your property.
This means you will need a rock-solid bricks and mortar insurance policy and potentially some extras covering a range of risks. These may include:
- Lost rent – if your tenant misses rent payments, breaks the lease or leaves the property without your consent; or if your property isn’t fit to live in because of loss or damage caused by an event.
- Loss of fixtures and fittings – this includes regular household items inside your property such as carpets, curtains, air conditioner/heater, stove or dishwasher.
- Legal action against a bad tenant.
- Theft or malicious damage by tenant – because you never know what your tenant’s visitors can get up to.
- Legal liability – this covers damage caused to other people’s property by fire emanating from your property, or death or injury caused by a problem at your property.
In addition to the above, you can get insured for rent default, meaning periods of time during which your tenant is unable to pay rent due to one of the following factors:
- Financial default/bankruptcy
- Eviction due to a court order
- Obtaining a hardship order
- Unexpected death.
Some of the insurance policies covering the above events will only take effect in four weeks following the incident, which is why all landlords should stick to the four weeks’ rent as bond when signing the tenancy agreement. Make sure you have ample coverage against scenarios involving potential damages to your property or sustaining financial losses due to one of the above events.
Contents in furnished properties
If you’re renting out a fully or partially furnished property, you might look into getting a contents policy for the following items:
- Your furniture
- Household goods/utensils/electrical appliances/whitegoods
- Floor coverings, e.g. carpets, rugs
- Detachable light fittings.
A number of insurance companies will do deals on combined policies. If your tenant and/or their guests cause damage to your property, your insurer will normally cover the damage, although in some cases they may charge a premium for this.