One thing you learn quite quickly as a new landlord is the steps you need to take to protect yourself, your property and your tenants. Insurance is clearly one such measure. But standard home policies won’t cover rental activities, and your mortgage lender will typically ask you to take out a specialist landlord policy anyway, even if this isn’t technically a legal requirement.
You can take your pick from a broad line-up of insurance products designed specifically for landlords, from property owners’ liability to contents policies and buy-to-let buildings protection. What you choose will depend to an extent on your attitude to risk.
One type of cover you may not have been aware of, but which can give you great peace of mind for a modest yearly premium, is Rent Guarantee and Legal Expenses. In a nutshell, this insurance gives you, as the landlord of a residential property, access to legal advice plus help if you incur costs and expenses as the result of any legal disputes relating to the letting of your residence.
It’s not the same as loss of rent cover, although it can seem similar. Rent guarantee insurance provides protection against the financial risk of tenants not paying rent. Rent cover is usually part of a landlord’s insurance policy, and covers lost rental income should a place become uninhabitable through something like a fire or flood.
You’ll need good reference checks on your tenants before taking out a policy like this, but of course at Oakfield Estate Agents we do this very thoroughly for all our tenants as a matter of course anyway.
At Oakfield, we offer this product from the household-name industry giant Rightmove, which gives landlords peace of mind that they enjoy this protection with a reputable provider. And we urge all our landlords to protect themselves with a policy like this.
What’s covered?
Get Rent and Legal insurance through us at Oakfield as a standalone policy and pay just £380 a year – a small price for peace of mind.
You can then look forward to cover worth up to £100,000 per insured incident for:
- Legal costs and expenses
- Rent arrears up to the point of vacant possession
- Alternative accommodation costs, up to a maximum of £5,250
- Storage costs worth up to a maximum of £450
Repossession
You will have help in pursuing your legal right to possess your property from your tenant.
Rent protection
You will be covered for unpaid rent up to the indemnity limit until the place is empty. If you can’t relet the property immediately due to neglect or damage on the part of your tenant, you’ll also be covered for up to 75% of the monthly rent you would have received, for up to three months until you can let out your property again.
Rent recovery
Help in recovering rent owing under a tenancy agreement.
Alternative accommodation and storage costs
If a tenancy agreement has expired and you want to repossess the property in order to live in it, you can claim for a contribution towards the cost of alternative accommodation, plus the cost of storing your personal belongings for up to 30 days.
Damage to your property
Assistance pursuing your legal right against tenants or others who have caused direct damage to your property and its contents.
Nuisance and trespass
If there is a dispute over legal nuisance or trespass which affects the use, enjoyment or right over your property, this insurance helps you with your legal right to evict anyone who is not a current or previous tenant.
The cover will also help you with your defence in certain criminal prosecutions, contractual disputes and with witness expenses. Equally, you can seek representation with HMRC probes into your personal tax affairs, plus there is confidential phone advice for personal legal or tax matters, as well as a counselling helpline if you’re experiencing distress.
Are there any limitations?
- As you’d expect, one policy is designed to cover one tenancy at a single property. So if you have multiple rental properties, you will want to cover each tenancy in all of them.
- Again as you’d expect, the property you let out must be in the UK.
- As landlord, you need to do everything reasonably possible to minimise the risk of a claim occurring, and not occur any unnecessary costs.
- As with most insurance policies, you won’t be covered for any issues you were aware of before the cover started.
- There must always be at least a 50% chance that any claim under your policy will have a successful outcome.
Finally, as with any policy, terms and conditions always apply, so read all relevant documents very carefully.
Oakfield says
We have successfully claimed on these policies for numerous landlords, either for rent arrears in the event of non-payment, or for help when regaining possession of a landlord’s property when going down the Section 21 route. So we have full confidence that the product we offer is the best on the market. And we cannot stress strongly enough to our landlord clients the importance of having this cover in place from the outset and at all times, alongside landlord property insurance.
It’s a great way of securing complete peace of mind, and all for just a few hundred pounds a year. Get in touch with us today to learn more. Click here for our contact info.