If you’re thinking of renting out property in the Peterborough area, landlord insurance is an item to add to your to-do list. Like all homeowners, you’ll need to take out buildings, and probably contents insurance to protect the rental home against risks including fire, flood, theft and accidental damage.
The important thing to remember is that you’ll need a bespoke landlord product – it’s a condition of most buy-to-let mortgage deals, and residential insurance policies won’t cover you for renting out property. So if you want to start making the most of the rental market by letting out your property in Cambridgeshire or in Northamptonshire, speak to your insurance company before you begin your search for tenants.
Aside from buildings and contents policies, there are other types of insurance aimed at landlords to consider – from rent guarantee protection to home emergency cover. To help you decide if these are right for you, read our guide to landlord insurance. We look at the different types of landlord insurance, and a few things you should know about each.
What Is Landlord Insurance?
Like any other insurance product, landlord insurance protects you and your property if things go wrong. Landlord insurance isn’t a legal requirement, but it can guard against the risks associated with letting to tenants that a regular home insurance policy doesn’t. Essentially it’s a key part of letting out your property – find out what the government’s requirements are here. Some insurance companies offer cover-all packages, or you can take out separate policies to cover your own particular needs. The main types of landlord insurance are:
1 Building Insurance For Landlords
Landlord buildings insurance covers the cost of repairing or rebuilding your property if the structure is damaged or destroyed. This type of landlord insurance is mandatory for a buy-to-let mortgage with most lenders, so you will need proof you have a landlord buildings insurance policy in place.
The amount of buildings insurance you need will be based on an estimate of the cost of rebuilding your rental property from scratch, including labour and materials. Your policy will usually include cover against damage to the structure of your property as a result of:
fire
theft
vandalism
malicious damage
subsidence
burst pipes
However, landlord buildings insurance won’t cover wear and tear, or damage caused by bad workmanship to repairs. Note, you still need standard landlord insurance if you’re renting to family members. But you don’t usually need landlord insurance for lodgers renting a room in your main home (a residential mortgage and insurance should be fine, but you must your current provider).
If your rental property is a flat, be careful to take out a policy which covers you for damage caused by other units in the block.
How much does it cost?: £100 to £240 p/a on average.
2 Fixtures & Fittings Insurance For Landlords
Is fixtures and fittings cover included in your landlord building insurance policy? You may need this landlord insurance for a leasehold flat – the freeholder’s own policy often won’t include fixtures and fittings cover. Find out, then consider separate fixtures and fittings insurance to cover:
Internal doors
Bathroom suites
Fitted kitchens and appliances you supply
Tiled or laminate flooring
But this type of landlord insurance doesn’t usually cover theft, deliberate tenant damage or anything usually classed as contents.
How much does it cost?: £100 to £140 p/a on average.
3 Landlord Contents Insurance
If you rent out your property furnished, you will need contents cover as a landlord – it protects the items and furniture you have provided. Even if you rent the place unfurnished, you should consider contents insurance to cover the fixtures and fittings, carpets and appliances in the property. You are not required to insure your tenants’ possessions.
How much does it cost?: £90 to £320 p/a on average.
4 Landlord Liability Insurance
This type of public liability insurance can usually be added to your policy (and is similar to professional indemnity insurance in many business insurance products). Like indemnity insurance, property owners’ liability insurance offers cover if your tenant tries to sue you for an accident on the premises. Your tenant could also claim compensation if their personal possessions are damaged at the property. Damages claims can be costly, so landlords’ liability insurance offers useful protection.
How much does it cost?: £40 to £60 p/a on average.
5 Landlord Insurance For Loss Of Rent
If you rely on the rent to meet your buy-to-let mortgage repayments or for your own income, landlord insurance for loss of rent can help. Loss of rent cover applies while your property is uninhabitable, such as after a fire or flood – but check the conditions of when the policy will pay out.
How much does it cost?: £60 to £200 p/a on average.
6 Rent Guarantee Insurance
Rent guarantee insurance policies offer income protection over a longer time and can cover your rental income if the tenants stop paying rent. However, landlord rent guarantee cover doesn’t usually include the first month of rental arrears, higher risk tenants, rent unpaid after tenants have vacated or been, or disputed rent.
How much does it cost?: £150 to £220 p/a on average.
7 Landlord Legal Expenses Insurance
You can also take out cover for any legal expenses you might incur if you take your tenant to court or are involved in a dispute.
How much does it cost?: £35 to £50 p/a on average.
8 Landlord Emergency Cover
Home emergency policies protect you and your tenants for boiler breakdown, blocked drains, rodent infestations and electrical issues – usually with 24-hour access to qualified engineers, depending on the landlord insurance cover you select. Emergency cover is most useful if you don’t employ a managing agent with tradespeople of their own, or live some distance from the property.
How much does it cost?: £130 to £250 p/a on average.
9 Landlord Unoccupied Property Insurance
You need unoccupied property insurance if your rental property will be empty for an extended time, perhaps before you renovate or sell. Unoccupied home insurance policies often last 30-60 days (occasionally up to 12 months). They usually cover fire, storm damage, subsidence, damage to a neighbour’s property (e.g. from a burst pipe), theft, vandalism, and squatters. But they won’t cover damage caused by contractors or major structural work – or if you’ve left a window or door unlocked.
How much does it cost?: £200 to £300 on average.
10 Landlord Key Care Insurance
If your tenant’s keys are lost or stolen, key care insurance covers the cost of a locksmith plus replacement locks and new keys.
How much does it cost?: £20 to £50 p/a on average.
Landlord Insurance – Frequently Asked Questions
How Much Does Landlord Insurance Cost?
This will depend on the type of property you own, your location, the number of tenants, the level of policy you want and level of excess you choose. Use a comparison site to compare costs, but don’t go by price alone – check that each quote will offer adequate cover for your needs. Ensure that the insurer you choose is properly authorised and regulated by the Financial Conduct Authority. Despite the added cost, remember that landlord insurance is tax deductible.
Is Accidental And Malicious Damage Cover Included In Landlord Insurance?
Accidental damage cover for breakages and spills is not always included in landlord insurance packages as standard. Malicious damage may be included in both building and contents landlord insurance. Check the terms of the policy carefully to find out if you have cover for accidental or malicious damage by tenants, visitors or persons unknown – otherwise you may need to pay extra.
Will My Landlord Insurance Cover An Unoccupied Property?
Properties are at greater risk of fire, burglary and vandalism if they are unoccupied. Most residential policies will only cover an empty property for up to 30 days. As voids are a common part of renting out property, landlord insurance often covers empty properties for longer periods. But always check the terms to avoid unexpected surprises if you have to make claims on your landlord insurance.
What About Alternative Accommodation Cover?
If your property becomes uninhabitable as a result of fire, flood or some other event, it is your legal responsibility as landlord to provide accommodation for your tenant. Try acting quickly to put things right, but if you have to find alternative accommodation it could be expensive so check that your cover includes it.
How Much Landlord Insurance Cover Do I Need?
For buildings insurance your cover should be based on the rebuild value of your rental property – an estimate of how much it would cost to rebuild your house from scratch, including labour and materials. Your contents insurance should be based on the cost of replacing your items in the rental property.
Find Out More
If you have questions about any aspect of renting out property in Peterborough and the surrounding area, we’d be happy to help. Please contact us today to discuss our services for landlords.
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Wayne Beecham
Wayne is East Midland’s answer to property management. His hard work and high standards of service have gained him a fierce reputation within the regional lettings market. He knows what it takes to own and manage a profitable portfolio himself, because he is not only a successful investor and landlord, but co-founder and “hands on” managing director of Progressive Lets.
The team is really professional and time conscious. Had a smooth move in as well.
Rita Davey
Very good communication and friendly service, long may it continue. Thank you guys at Proggesive Lets!
Michael Wadham
Very friendly and professional service by Joe Mulhearn throughout the rental application process.
prince sarfo
Lovely timely response and assistance.
Very good
Keep it up
Olamide Ige
Wow!!! Zoe is an amazing soul. Very helpful and accommodating. The sky is the limit for her!!! She did an amazing job.
To Zoe, God bless you more and more ❤️
Grzybobranie
Been renting with them for over 3 years now and overall had a good experience. Of course over that amount of time there were a few issues here and there, which is pretty normal, but whenever I needed help Kieron was always easy to deal with, helpful and quick to respond. Communication was always str...
Aghogho Braimah
Progressive Lets is a very good and professional lettings agency. As a it was my first time letting a property, the company particularly the property manager Tam, was very patient and kind best believe I had too many questions to ask. I highly recommend Progressive Lets to anyone looking to rent ...
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