Landlord insurance

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**51% of people could achieve a quote of £226.36 per year for their Landlord Insurance Buildings Cover based on Compare the Market data from March, 2022.

What is landlord insurance?

Landlord insurance is home insurance designed for rental properties. It can offer you more protection for your rental property than standard home insurance. Also known as buy-to-let insurance, this type of cover can protect you against damage to the building structure itself, as well as the contents in your rental property.

Just like home insurance, landlord insurance can cover your rental property against common risks from fire, flooding, burst pipes and storms.

You can also choose to add extra cover specifically for landlords, for example:

Accidental damage – can cover repair costs of damage accidentally caused by your tenants

Landlord emergency cover – protects you against costs for labour and call-outs in an emergency situation – for example, if the boiler stops working

Legal expenses cover – could protect you against costs for a number of legal matters related to being a landlord, for example, contract disputes, evictions, squatters, and repossession issues

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Do I need landlord insurance?

While you’re not legally required to take out landlord insurance, it’s definitely advisable. Even the best of tenants can be unpredictable, and you never know when things could go wrong. Landlord insurance can also provide more specific cover than a standard home insurance policy. 

It’s worth noting that if you have standard home insurance your policy might be invalid if you rent out your property to tenants, and you need to make a claim. If you’re applying for a buy-to-let mortgage, it’s likely your lender will insist you have landlord insurance as a condition of the loan. 

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From fixtures and fittings or buildings insurance to legal expenses, you can find insurance that's specially designed for the needs of landlords. We’ve teamed up with Simply Business to offer you tailored quotes from leading landlord insurance providers.

What does landlord insurance cover?

You can add different levels of cover to your policy, depending on what you want to be covered for. This includes: 

  • theft, fire and flood 
  • the structure of the building
  • built-in features, for example fitted kitchens and bathrooms
  • items such as furniture, carpets and curtains (this doesn’t include your tenants’ belongings) 
  • your rental income – if you can’t rent the property due to damage 
  • legal costs in case you’re taken to court 
  • any vacant periods in between tenants 
  • accidental damage by tenants 
  • boiler breakdown 
  • rent arrears 

Bear in mind that the more cover you include, the higher the premium is likely to be for your policy. 

Why use Compare the Market?

We’ve partnered with small business insurance experts, Simply Business, to find insurance tailored to your needs.

We search landlord insurance from 12 leading providers[2]

92% of users would recommend Compare the Market to friends or family[3]

[2]Correct as of March, 2022

[3]For the period 1st June to 31st August 2021, 8944 people responded to the recommend question. 8,226 responded with a score of 6 or above, therefore 92.0% are likely to recommend.

What types of landlord insurance are available?

There are several types of landlord insurance. Take a look at the options below:

Landlord buildings insurance

If you own the freehold of the property, landlord buildings insurance is a good idea. It typically provides cover for loss or damage caused to the building and could provide a pay-out if your property is damaged due to fire or flood, for example.  

Landlord contents insurance

If you’re renting out a furnished property, you might want landlord contents insurance to cover the things you own. You could also add accidental damage cover to your landlord insurance, which could cover damage caused by your tenants. If you’re renting out flats, you could get contents cover for communal areas. Many policies include this cover as standard and you can tailor its limit to your needs.

Rental income protection 

Also known as loss of rent insurance, this can protect you if your building is damaged and you’re unable to rent it out. It’s important to properly assess the rebuilding period for your rental property before you take out the cover. You should read the lease carefully as it may also contain specific requirements for this.

Rent guarantee insurance

Rent guarantee insurance, also known as tenant default insurance, could provide cover for you if your tenants are unable to pay their rent.

Property owners liability (public liability) insurance

If a tenant has an accident at your property and considers it to be your fault, they could decide to take legal action against you. Public liability insurance could cover you for your legal defence costs and expenses, as well as any damages awarded.

Employers’ liability insurance

Employers’ liability insurance is a legal requirement if you employ anyone at your rental property who is directly under your supervision and control. They might be a cleaner or gardener, or even a volunteer. You’ll be responsible by law for arranging employers’ liability insurance to cover you for legal defence costs and any awards made for accidental injury or illness caused to staff because of your negligence.

Unoccupied property cover

Unoccupied property insurance might be useful if you need to make renovations to the house or flat before you rent it, or if you’re in-between tenants. Usually “unoccupied” means there’s no one living in the property for more than 30 days.

Landlord emergency cover

Landlord emergency cover offers you 24-hour, seven-days-a-week assistance if there’s an emergency which needs sorting at one of your properties. So, if a pipe bursts at a tenant’s home, you can cover the cost of an emergency plumber working out of standard hours.

Because the extent and cover of commercial landlord insurance premiums vary, always compare landlord insurance policies to get a deal that’s right for you.

How much does landlord insurance cost?

The cost of landlord insurance is influenced by several things, including:

The level of cover

Make sure you’re not paying for cover and add-ons you don’t need.

The location of your property 

If your property is a high-crime area you’re likely to pay more.

The size and age of your property

These will affect how much it would cost to repair.

Your tenants

Students, for example, are considered higher risk.

Your claims history

If you’ve claimed on your insurance before, it will raise your premium.

How you pay

Paying for your insurance annually if you can is cheaper than paying monthly.

Because the extent and cover of commercial landlord insurance premiums vary, always compare landlord insurance policies to get a deal that’s right for you.

How to get cheaper landlord insurance

Your rented property is your business, so it’s important not to scrimp on your insurance. However, there are things you can do that might help reduce the cost of your premium.

Install good security: solid locks, burglar alarms and CCTV can make your property less attractive to thieves, meaning insurance providers might see it as less of a risk and reduce your premium.

Increase your excess: voluntary excess is the amount you pay towards an insurance claim. Increasing it might lower the cost of your premium – but you’ll need to make sure you can afford to pay if you do make a claim.

Think twice about pets: unfortunately, pets can raise the cost of your premium because of the damage they can cause. Not allowing pets might mean lower premiums.

Avoid unoccupied periods: empty properties are considered more of a risk by insurance providers, so try to avoid big gaps between tenants if you possibly can.

Combine your insurance needs: packaging up the different types of insurance you might need as a landlord into a single policy might work out cheaper than buying them separately.

Be careful about tenants: insurance providers look at the risk different types of tenants present – students, for example, are considered risker than professional tenants.

Author image Emily Kindness

What our expert says...

“The cost of landlord insurance varies depending on things like the size of the property and the type of cover you choose. You can help to reduce the cost of your insurance policy by demonstrating that you’re on top of risk management. For example, by having ample security measures in place and ensuring tenant referencing checks take place when bringing in a new tenant.”

- Emily Kindness, Business Insurance expert

Frequently asked questions

How has landlord insurance been affected by the coronavirus pandemic?

The impact of COVID-19 is still causing financial worries for many. And while the ban on evictions during the pandemic has now been lifted, the Government continues to urge landlords and tenants to find a mutually acceptable and temporary resolution to rental payment issues.

If you have rent guarantee cover as part of your landlord insurance, you’ll be able to claim for the loss of rental income for up to a year. This should give you plenty of time to come to an agreement with your tenant, or, if worse comes to worst, go through the eviction process and find a new tenant.
For a range of tools to help both you and your tenant, you can contact our partner DAS, who are legal expenses insurance experts. 

Is landlord insurance a legal requirement?

Landlord insurance isn’t a legal requirement, but if the worst happens, it can give you vital protection for your property investment. Many mortgage lenders make it a requirement to have buildings insurance when taking out a buy-to-let mortgage.

If you employ anyone, it’s a legal requirement to have employers’ liability insurance.

Can I be covered by ordinary home insurance?

Your home insurance may not cover a rented property if you’re not living there. That’s because there are issues with rental properties that aren’t likely to arise with the property you live in: 

  • You won’t get to see the property often and judge the state it’s in
  • Tenants may not pay attention to maintenance issues like damp, which could get out of hand
  • Your tenants may cause careless or even malicious damage
  • You could be liable if a tenant is hurt while in your property 

Regular home insurance isn’t designed for the specific issues that landlords might face. Your policy might not cover any claims you need to make, or claims made against you by tenants.  

How do I make a claim on my landlord insurance policy?

It’s important to refer to the details on your policy, to make sure you’ve got the right cover for what you need to claim for. If you’re a victim of a theft, you should report the crime to the police and get a crime reference number. After that, get straight in touch with your insurance provider. 

Do I need contents insurance as a landlord?

If you rent your property as furnished, it’s a good idea to have landlord contents insurance. Furniture, carpets and curtains can be expensive to replace. Contents insurance could cover the cost if they’re damaged or destroyed – potentially saving you from a big pay-out.

Can I get insurance for multiple properties?

Yes. If you rent out multiple properties, you have a couple of options for landlord insurance: 

  • Insure each property individually. You can compare policies that are tailored to suit each property.
  • Put multiple properties on one policy. This is a little more complicated, as the insurance provider may be willing to offer you a multi-property deal for your circumstances. We can’t help you compare policies and prices for this, but you can contact insurance providers directly for a quote. 

Is landlord insurance tax deductible?

Yes, typically landlords can claim the expenses of running and maintaining their property, which includes the cost of landlord insurance, to reduce their tax bill.  Any expenses claimed for, should be incurred wholly and exclusively as a result of renting out the property. For example, for:

  • insurance
  • general property maintenance and repairs (not cosmetic improvements) 
  • water rates, council tax, gas and electricity
  • letting agent fees, management fees and accountant fees 

The first £1,000 of your income from property rental that you personally own, is tax-free. This is your ‘property allowance’. To work out your profit – or loss - you need to: 

  • add together all your rental income
  • add together all your allowable expenses which includes your landlord insurance 
  • take the expenses away from the income 
    If your profit is £1,000 or less, you just need to make sure you have claimed for your property allowance in your tax code. 

If your income from property rental is between £1,000 and £2,500 a year, you’ll need to contact HMRC to make sure you’re paying the right amount of tax and claiming the allowances you’re entitled to claim for.

You must report the income and the expenses you’re claiming on a Self-Assessment tax return, if it’s:

  • £2,500 to £9,999 after allowable expenses
  • £10,000 or more before allowable expenses

Do I need landlord insurance if I live in the property?

It depends whether the person you’re renting to is a lodger or a tenant. Someone is a tenant if there’s an agreement that you can’t enter their room without permission. In this case, standard home insurance won’t cover you and you’ll need to apply for specialist landlord insurance, specifying that you live in the property.  
A lodger is someone who lives in your home and shares living space with you. If this is the case, you can usually be covered by an extension to your standard home insurance.

See more on home insurance if you have a lodger

Is loss of rent covered?

Landlord insurance can cover loss of rent, but it’s not usually part of standard cover – typically you’ll need to add it to your policy. You may be covered if you can’t rent the property because of fire or flood damage, as long as that detail is included within your policy. If your tenants are unable to pay, you’ll need specialist add-ons. For example, landlord rent guarantee insurance

What should I do if my tenant can’t or won’t pay rent?

If your tenant is struggling to pay the rent, they should let you know as soon as possible. If they have a legitimate issue and are a good tenant, it’s always best to try and work out a deal between you that works for everyone. That way, you’ll have a better chance of keeping the tenant in the home and continuing to pay rent long term.

For times like these, it’s best to have rent guarantee insurance in place. This offers you cover for the rent you’re owed, and can protect you for up to a year of lost rent, which gives you the time you need to resolve the situation with your tenant. It can also cover the costs of a legal battle with them.

If worse comes to worst and you need to evict the tenant, you have to give them at least two months’ notice and serve them a Section 21 notice. But the reality is it could take up to several months to evict a tenant – that’s a long time to be losing out on rental income. This makes rent guarantee insurance worth thinking about.

Do I need to take out boiler cover as a landlord?

It’s up to you, but, as the landlord, you’ll be responsible for buildings insurance for the home, which boiler cover falls under. It’s not a legal requirement, but it’s a good idea to get cover, to protect your investment. Boiler cover is available as a separate policy, so you could always arrange it that way, too. 

What do I need to get a quote?

When you start a landlord insurance quote with us, it’s a good idea to have some basic information to hand:

  • Your current insurance policy documents (if you have them)
  • Details about your property
  • Basic tenant information
  • The level of cover you need 

We’ll ask you questions to make sure we have all the information we need, to provide you with a list of suitable quotes. 

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