What does landlord insurance cover?
Landlord insurance provides property damage cover by default. But contents insurance and other policy add-ons are available for an extra charge.
One of the key benefits of specialist landlord insurance is cover for property damage or loss due to:
- storms/lightning strikes
- heave of land
- a motor vehicle colliding with your property
Damage to outdoor property spaces such as your garden, patio, or driveway is also covered by some policies.
The household contents inventory of your rental property can be insured against theft or damage. For example:
- Damage to permanent fixtures and fittings such as built-in wardrobes, appliances, carpets and kitchen units
- Theft or damage caused by fire, flood etc of any non-fixed items the landlord has provided. For example, beds, free-standing wardrobes, and sofas.
- Accidental damage to building or content fixtures and fittings (service pipes, sanitary fittings, coffee tables, hi-fi equipment etc) is not covered as standard, but can be for an additional payment.
Property owner's liability insurance
Property owner's liability insurance is an add-on that covers the cost of compensation and legal expenses if you're found liable for an accidental injury to a tenant, tradesperson, or other person whilst they're on your property.
For example, if a tenant tripped and injured themselves because of a loosely fitted carpet, you could be found liable for compensation.
Legal fees are often included with the policy, as is accidental damage to the person's belongings.
Loss of rental income
Optional cover that allows you to claim lost rental income if your tenants are forced to move out of your property due to flooding, fire, storm damage, or another insured event.
Many policies cover the cost of providing alternative accommodation for your tenants whilst your rental property is repaired or rebuilt.
Tenant default insurance
Also sometimes referred to as rent guarantee insurance, optional tenant default cover allows a landlord to claim unpaid rent if a tenant gets into financial difficulty. For example, if they're made redundant.
Typically you'll be required to serve an eviction notice but you can claim from the first missed payment and up to 12 months of rent are covered.
Rent guarantee insurance can also pay out if your property is uninhabitable for a period due to malicious damage by the tenant.
No-claim discount protection
This option is often only available if you've not claimed against a landlord insurance policy in the past five years. The add-on protects your no-claims discount when you make a first claim.
Alternative accommodation cover
If your Assured Shorthold Tenancy (AST) agreement stipulates that you must provide alternative accommodation for your tenants if an insured event like flooding or fire damage occurs, this policy add-on will fund the cost.
It will continue to pay until your property is repaired and inhabitable again, or the policy ends. Whichever comes first.