What is Landlord Insurance?

Landlord insurance is special cover designed for landlords to cover them from risks associates with their rental property. Normally, it includes buildings and contents insurance, but it can also include landlord-specific covers such as property owners’ liability, loss of rent, and tenant default insurance. There is also landlord insurance over 60 plans available.

What Does Landlord Insurance Usually Cover?

There are a handful of different types of landlord insurance available to cover different risks:

Landlord Buildings Insurance: This covers the cost of repairing or rebuilding the property if the structure is damaged or destroyed. Some options of this insurance type will also cover contents – furniture and other items if they’re stolen or damaged. 

Tenant Default Insurance: This type covers you as a landlord should your tenants fail to pay their rent. Property owners’ liability insurance is another option that covers compensation claims made by tenants or visitors for injury or damage related to the property. 

How do you know if you need landlord insurance and how much does it cost?

If you have one or more rental properties under your name, then yes. It’s important to make sure that you have got the right insurance in place. For example, a standard home insurance policy won’t cover you for risks associated with renting your property. It’s also important to know that landlord insurance isn’t a legal requirement, but it’s usually best to get it as it’s often required by mortgage lenders. 

When it comes the cost of your landlord insurance, it will all depend on your property and tenants, the type of policy you choose, and the levels of cover that you need. Like with many insurance providers, insurers will calculate the cost of your insurance (known as your premium) based on the likelihood you’ll make a claim and the possible cost of any claim that could be made. Usually, you can use online calculators to find an approximate quote. 

What Landlord Insurance do I need?

Buildings insurance, fixtures and fittings cover, and property owners’ liability insurance will all be necessary forms of cover that you will need as part of your insurance policy as a landlord. IF you have a furnished property that you rent out, it’s also important to get contents insurance in case there is any damage during the tenancy durations. 

There are other covers you can choose to add to your insurance policy. For example, accidental damage insurance and landlord legal expense insurance. Again, the type of cover you have will depend on the risks you want to cover. Perhaps you rent out student house or live in an area where there may be more chances of property damage. 

How Much Landlord Insurance Do You Need?

The amount of landlord insurance you take out and the different levels of cover you choose should be based on the rebuild value of your rental property. In other words, how much it would cost to rebuild your house from scratch, including labour and materials. 

Likewise, your contents insurance should be enough to cover the cost to replace all the contents you have in the rental property. This is particularly important for landlords who offer furnished rentals. Importantly, this does not include your tenants’ belongings, which is why it’s important to state this in your tenant contracts as they will need to take out their own cover.