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If you're a landlord or thinking of becoming one, you might wonder what landlord insurance is and if it's an essential requirement. This insurance is designed to protect landlords against common risks associated with renting out properties. It includes a range of specialist insurances, such as landlord building insurance, rent protection insurance, and liability insurance.
This guide provides all the information you need to know about landlord insurance, including:
What is landlord insurance?
Types of Landlord Insurance
Is landlord insurance mandatory?
Do I need landlord insurance?
What is landlord insurance?
Landlord insurance protects landlords from the risks of renting properties, such as damage, loss of rental income or legal liability. This makes it different from home insurance, which is designed for homeowners - landlord insurance is tailored specifically to the needs of landlords.
Types of Landlord Insurance
Whether renting out just one property or a large portfolio, being a landlord comes with several risks outside your control. Landlord insurance is designed to mitigate these risks.
Different types of landlord's insurance are designed to protect you from different risks. Although there are many different types of insurance, you won't necessarily need all of them. The insurance you choose will depend on the type of property you rent, the type of tenants and your unique situation.
Here is a quick summary of the 3 most common types of cover:
Landlord buildings insurance: This is one of the most common types of landlord insurance cover. It covers the cost of rebuilding or repairing your rental property in the event of damage to your property. This could be from natural disasters, theft, vandalism, fire or flooding.
Landlord contents insurance: You should consider contents insurance if renting out a part or fully-furnished property. This protects your white goods, furniture and other items from damage. Some policies may also cover malicious damage.
Landlord liability insurance: This public liability insurance is designed expressly for landlords. If there are any injury or damage claims related to your rental property, landlord or property owner liability insurance will ensure you are protected.
Although these are the most common types of insurance, there are many other policies and add-ons that you can select to ensure you're fully protected, such as legal expenses insurance and tenant default insurance to protect you from lost rental income.
Check out our blog, '9 Types of Landlord Insurance That Can Protect You From a Personal Lettings Disaster', for a more thorough breakdown of the different types of cover.
Is landlord insurance mandatory?
There is no legal requirement to have any form of landlord insurance to protect your rental property. However, you'll likely be required to have insurance if you have a mortgage on your rental property. At a minimum, you'll likely be required by your mortgage lender to have landlord-building insurance to protect the property's structure.
Do I need landlord insurance?
Even if you aren't required to have insurance (because you don't have a mortgage), it is still something you should strongly consider. Landlord insurance helps to protect your property and your tenants against the common risks associated with renting out a property. Without it, your assets could be at risk if something happens.
Additional cover add-ons or specialist landlord insurance policies help you stay protected against all eventualities. For example, rent guarantee insurance ensures that you are not at a financial loss if your tenants stop paying rent. Evictions can take over 6 months, so taking out specialised insurance ensures you will not suffer financially. This is especially crucial if you rely on your rental income to pay your mortgage or need it for living expenses.
Why Choose Advanced Rent?
Advanced Rent offers a variety of landlord insurance options to protect your investment. Get a free quote today and speak to one of our insurance specialists to find the right coverage for you.