If you’re a landlord the chances are you’ve heard of landlords insurance. However, many landlords aren’t fully aware of the levels of protection that each type of insurance provides. Here, we look at why landlords insurance is important not only for landlords, but for tenants and the rental property.
Do landlords legally have to take out landlords insurance?
Surprisingly there is no legal requirement for a landlord to take out a dedicated insurance policy. However, a conventional home insurance policy will not cover for rental activities and could deem the insurance invalid. It’s recommended that landlord insurance is taken out before tenants move in, and is usually required by a mortgage provider. Failure to secure the correct insurance could potentially mean you are breaking the terms of your mortgage.
What does landlord’s insurance cover?
Different types of landlords insurance will cover different risks. You can choose from a range of covers such as property owner’s liability insurance, contents insurance and buy-to-let buildings cover. It’s worth noting that you should carefully read each policy to understand the full extent of cover provided. Buildings insurance covers the cost of repairing your property, while contents insurance covers your contents if they’re stolen or damaged. Most landlord insurance policies include buildings insurance or fixtures and fittings insurance, plus property owners’ liability insurance. As a landlord its generally best to buy insurance based on the risks you want to cover. You can always add on additional cover such as accidental damage, loss of rent and tenant default.
What other insurance policies are required?
Landlord insurance is a type of homeowner insurance that’s designed specifically for rental properties. This means you shouldn’t need to have landlord insurance and separate homeowner insurance. Buildings and contents insurance is usually part of landlords insurance so long as you choose a landlord contents insurance. If you are unsure what is covered in your policy contact your provider for a thorough breakdown. It’s also worth shopping around for the best deals annually.
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