What is landlord insurance and what does it cover?

If you’re a landlord, it’s important to safeguard yourself against risks associated with renting out properties. One of the things you can do to protect your investment is to buy landlord insurance.

In this guide, we cover what you need to know about landlord insurance and tips for finding the best policy.

What is landlord insurance?

Landlord insurance protects property owners who are renting out their homes or buy-to-let properties. It can provide coverage for risks not usually included in standard home insurance policies including damage caused by tenants, loss of rental income and landlord liability.

Landlord insurance isn’t a legal requirement in the UK, but mortgage providers may require it as a condition of their lending terms for buy-to-let properties. This type of cover can provide landlords with peace of mind, as they’re financially protected against the impact of unexpected events that they would otherwise have to pay for themselves.

Types of landlord insurance

Landlord insurance usually provides three main cover options:

Landlord buildings insurance covers the property structure including walls, roof and permanent fixtures. Tenants are not generally expected to buy buildings insurance, so landlords who want to protect their building should consider this policy.

Landlord contents insurance is for landlords renting out furnished properties as it provides cover for their personal belongings that tenants have access to. This landlord insurance doesn’t cover tenants’ personal belongings, they’ll need to buy their own policy.

Landlord liability insurance protects you if a tenant or visitor is injured on your property and holds you responsible. It can cover legal costs and compensation claims.

What does landlord insurance cover?

Like any policy, the specifics of what’s covered under landlord insurance products will vary across providers. Some include extra protection as standard and others may charge additional premiums.

A standard landlord insurance policy for the building will usually provide cover for:

• Fire
• Flood
• Theft
• Structural problems
• Built in features like a kitchen or bathroom
• Loss of rent if the property is uninhabitable due to events like fires or floods

Landlords can choose to buy contents insurance for items they own like furniture or curtains.

If the chosen insurer provides it, landlords can also choose to buy additional cover for:

•  Rent guarantee if the tenant falls into arrears
• Landlord boiler cover
• Home emergency cover

What isn’t covered?

There are some common exclusions in landlord insurance policies, but these can vary. It’s important to check individual policy terms when researching products, but here are some of the main exclusions.

Tenants’ belongings
Landlord insurance doesn’t protect personal items belonging to tenants, they’ll need to buy their own policy.

Unoccupied properties
Many policies include restrictions for claims on properties left unoccupied for extended periods of time.

Wear and tear
General wear and tear isn’t usually covered as these costs are considered a normal part of property ownership and upkeep.

It’s worth mentioning here that landlord insurance is different to commercial landlord insurance, which covers properties rented out for business use. Before buying a policy, check that it’s the right option for the property you intend to rent out.

How to find the best landlord insurance

Here are some tips to help you find the best landlord insurance for your rental property.

Compare policies and providers
Comparison websites will help you evaluate different policies in terms of price and cover. But it’s also important to know what to expect as a customer. Reading reviews about insurance providers will help you understand the experience you’re likely to get.

Check for optional extras
Decide whether you need extras like landlord boiler cover or rent guarantee and check how much more you’ll be charged for your policy. Other policies may include these as standard so it’s worth shopping around.

Understand policy exclusions
 It may not sound like the most exciting thing to do, but it’s important to read the policy documents in full. Make sure you know what isn’t covered by your policy, so there are no surprises if you need to make a claim.

Bundle insurance policies
Some providers may offer a discount if you combine landlord insurance with other policies. Don’t be afraid to call them and ask if they have any offers if you can’t see anything on their website.

Landlord insurance in a nutshell

Landlord insurance isn’t a legal requirement in the UK, but it does provide important protection for anyone renting their property out. You can choose basic cover like buildings and contents, or you can get added protection with extras like boiler cover.

Before making a decision on which policy to buy, research landlord insurers, check the exclusions and don’t be afraid to try and haggle if you think you could get a discount!