Landlord insurance covers risks linked to renting out a property that standard home insurance may not cover.
Landlord insurance is designed for a property that is rented to tenants. It is also known as rental property insurance, buy-to-let insurance or let property insurance.
Standard home insurance is usually designed for a home occupied by its owner. Renting the property to other people changes how it is used and can create different risks. As a result, a standard policy may not cover claims linked to tenants or letting.
There is no single UK-wide rule requiring every landlord to buy landlord insurance. However, Rent Smart Wales says landlord insurance is a mandatory licence condition in Wales.
A mortgage provider may require suitable buildings cover. Tell the insurer before the property is let. In England, if the property has a mortgage, GOV.UK says you must get permission from the mortgage lender.
A policy will often include landlord buildings insurance. This may cover the cost of repairing or rebuilding the property after an insured event, such as fire, storm, flood or escape of water.
The buildings sum insured should normally reflect the property’s rebuild cost, not its market value. The Association of British Insurers explains that mortgage providers will usually require buildings insurance.
Depending on the insurer and policy, landlords may also be able to arrange cover for:
Some of these features may be optional. They can have separate limits, excesses and conditions. Landlords should check the policy wording before arranging cover.
A tenant’s personal belongings are not normally covered by the landlord’s policy. The ABI’s home insurance guidance explains that tenants may need their own contents insurance.
Some policies cover rent that cannot be collected because insured damage has made the property unfit to live in. This is usually called loss of rent cover.
The claim will normally depend on the related buildings claim being accepted. A financial limit, time limit or both may apply. The Financial Ombudsman Service has considered cases where loss-of-rent cover only applied after insured property damage.
Rent guarantee insurance is different. It is intended to cover certain rent arrears when a tenant fails to pay. Conditions may include tenant references, credit checks, a valid tenancy agreement and prompt action when arrears start.
A Financial Ombudsman Service decision found that wear and tear, pet damage and tenant theft were excluded under the policy being reviewed. This does not mean every policy has the same exclusions, but it shows why landlords should check exactly what is covered.
You should provide complete and accurate information about the property and how it is let. An insurer may ask about:
You may also need to report changes during the policy. This could include a change in tenant type, occupancy or how the property is used.
Empty-property conditions are important. Cover may be reduced after the property has been empty for a set number of days. Insurers may also require inspections, heating or other steps. The Financial Ombudsman Service explains how an unoccupied-property claim can depend on the policy definition and conditions.
We arrange landlord insurance through a range of insurers. We may be able to help with standard and non-standard let properties, including listed buildings or properties with a history of flooding.
Available cover, price and acceptance will depend on the property, tenants, claims history, insurer and full details provided. Before buying a policy, check its limits, excesses, exclusions and any conditions that apply between tenancies or while the property is empty.
