How to be a happy tenant-in-law when buying a house for rent in the UK?
Many Chinese buyers who purchase British real estate investments are not very familiar with the British real estate market.Let’s follow Lan Shajun today to see what types of landlord insurance can be purchased by landlords in the UK.
Is landlord insurance compulsory in the UK?
Purchasing landlord insurance in the UK is not compulsory by law.But landlord insurance is crucial when renting out your property, as it can protect you against environmental or accidental damage, and loss of rent.
A recent study of 755 British landlords showed that 13% of landlords did not purchase landlord’s home insurance, and the amount of losses was as high as nearly 600 million pounds. !
What does landlord insurance cover?
Landlord insurance is a collection of insurance policies such as house rental insurance, liability insurance, and rent guarantee insurance.But the exact coverage depends on the specific policy type you choose.
What types of landlord insurance are available?
Here are the six most common types of landlord insurance, you can purchase any type of insurance depending on the situation you want to protect yourself, And create your own landlord insurance policy.
1. Landlord Home Insurance
# {53}Suitable for landlords with detached properties in areas with a high risk of environmental hazards or theft.
Landlord building insurance covers the physical structure of your rental property, such as ceilings, walls, doors and floors.It protects buildings from various risks such as fire, storms, floods, burst pipes, cracks, theft and vandalism.The policy usually covers the cost of repairing or rebuilding the property.Some insurance companies also offer coverage for any loss of rental income during repairs.
It is important to note that landlord insurance and building insurance should not be used interchangeably.Building insurance is a type of landlord insurance.Landlord insurance, on the other hand, is a comprehensive insurance package that covers more than just damage to the physical structure.
2. Landlord contents insurance
Best for renting out furnished, semi-furnished or upholstered properties landlord.
Landlord contents insurance protects against damage, theft or loss of any furniture, appliances or other household items provided by the landlord.This policy does not cover anything brought in by the tenant.Therefore, it is crucial to build an inventory before tenants move in.
There are two nuances you need to know about contents insurance for rental properties.
First, insurance companies have different interpretations of this coverage.Some people may classify certain items in your property as fixtures and fittings, such as carpets and light fixtures.Therefore, where this is prone to confusion or disagreement, it is best to clarify with your insurance company before purchasing a policy.
Secondly, some insurance companies do not cover accidental damage such as spills, stains or damaged items, if this is the case then you will need to opt for a supplemental accidental damage policy.
3. Landlord’s Fixtures and Fittings Insurance
Best suited for furnishing fully or semi-furnished homes with furnishings Landlords with new or expensive fixtures and fittings.This is especially useful for landlords who rent out part of their primary residence or temporary rentals.
This insurance protects fixtures and fittings in the property, such as built-in wardrobes, kitchen cabinets and bathroom fixtures.This policy covers accidental damage, loss, Provides compensation for theft, water leakage, fire and sometimes malicious damage.
4. Landlord Liability Insurance
Suitable for those who live abroad and are unable to personally inspect or take care of the property. Landlords who want to be protected from huge damages or legal fees.
Landlord liability insurance protects the landlord if any defect in the property results in injury to the tenant or any third parties (and their belongings).Liability insurance will cover attorney fees and any compensation costs resulting from a tenant injury or negligence complaint.For example, if your tenant sues you because he was injured due to a broken staircase in his rental apartment.
5. Rent Loss Insurance
Ideal for landlords who own properties in areas with a high risk of environmental hazards.Or landlords who rely heavily on rental income to cover costs such as mortgage payments.
Loss of rent insurance provides landlords with coverage for lost rental income if the property becomes uninhabitable due to a natural disaster such as fire or flood.You will also be compensated when you make repairs and are unable to hire new tenants.Remember, your policy must state the circumstances under which the coverage is in effect.
6. Rent Guarantee Insurance
Ideal for all landlords who want financial protection if their tenants default on rent payments .
Rent Guarantee Insurance provides landlords with protection against tenants falling behind on rent.Most insurance companies provide rent coverage for up to one year, including legal fees and losses caused by the tenant under this policy.Depending on your insurance company, you may need to send an eviction letter to your tenant to receive compensation.
How much does landlord insurance cost?
The cost of landlord insurance depends on several factors, such as the location, type and age of the property , the amount of coverage selected, the number of expensive items in the property and the characteristics of the tenant (age, employment and marital status).
The average monthly cost of landlord insurance depends on the landlord insurance policy you choose.Here is a breakdown of the cost of personal insurance:
Average monthly price for landlord insurance
Buildings insurance £30
#{ 65}Contents Insurance £32Fixtures and Fittings Insurance £12
Owner’s Liability £35
Loss of Rent £17
Rent Guarantee Insurance £40
If you consider taking out all policies for better protection, the average monthly cost of basic landlord insurance in the UK is around £166 EUR.
If domestic real estate buyers encounter any problems during the purchase of British real estate, they are welcome to consult Lansha Real Estate Consultants at any time to obtain professional investment advice.
