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Landlord insurance: what it is and why you need it

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Being a landlord is an investment that can offer good returns, but it can also get expensive when something goes wrong. This can quickly eat into your profits and even leave you out of pocket. That is why it is important for landlords to have the right insurance, as this can protect your investment and ensure you continue to see a healthy return, even if problems do occur.

There are various types of insurance landlords should consider to cover all of the likely eventualities. Some of these types of cover are essential, while others are optional, but still worth considering.

Buildings insurance

Buildings insurance covers the cost of repairing or replacing damage to the property itself, for example from fire or flooding. It may also cover permanent fixtures, such as kitchen units and bathroom suites.

Although buildings insurance is not strictly a legal requirement for landlords, it is normally a condition of a buy-to-let mortgage. Even if you own your property outright, you are taking a big risk if you do not having buildings insurance as the cost of building repairs can easily run into the tens of thousands.

Emergency home cover

Emergency home cover means that if you have a problem such as a gas leak or burst water pipe in your rental property, you can get it fixed right away. This prevents a problem from causing additional damage and means your property is not rendered uninhabitable for an extended period.

Contents insurance

Although your tenants will be responsible for their own possessions, you may still want contents insurance to protect the things you own in the property, including carpets, furniture and white goods.

Liability insurance

Liability insurance covers you if a tenant is injured in your property and decides to sue you as a result. It will normally cover you for anyone injured in the property, not just your tenants. For student and social housing, landlord’s liability insurance is often a requirement.

Loss of rent insurance

Also sometimes referred to as rent guarantee insurance, this protects you if your tenants fail to pay their rent or if your property becomes uninhabitable, or cannot be rented for any other reason, for an extended period.

This type of insurance is often relatively expensive, but may be worth considering if you have a large mortgage that you would struggle to pay if you lost out on your rental income for any length of time.

Legal expenses insurance

There are a number of legal disputes that landlords can end up involved in, including disagreements with tenants, evicting squatters and repossessing your property. Legal expenses insurance can help cover the cost of taking legal action or defending yourself if a legal action is brought against you.

This type of policy may also cover the cost of recovering outstanding rent owed by tenants, although you may have to pay extra for this additional cover.

Protect your rental property with expert legal advice

Bird & Co Solicitors is a long-established law firm providing legal services and advice for landlords across England and Wales from our 3 offices in the East Midlands. We can assist with all the legal aspects of buying, managing and selling rental property. Our services for landlords include conveyancing, creating tenancy agreements, dealing with problem tenants and more, helping to protect you and your investment.

To find out more about our services for landlords, call us today on 01476 591711 or use our contact page to find details of your nearest office.