Real estate landlord can be a lucrative business. All you have to do is buy a property and rent it out for regular monthly payments. While this is true, you can get in the hot water if you are not careful about getting proper insurance. Not having adequate insurance, or even the right type, can have significant financial impact, both personally and in the business. Nowhere is this truer than in London where the huge variety of properties, people and price variance all contribute towards the number of different insurance policies available to landlords.
It is important when renting out that you have the correct landlord insurance for your property and its uses. Not only is this a legal requirement but also it protects you in case of any problems. Companies like UKinsurancenet.com have policies for every type of property and easily provides online quotes.
Buy To Let Insurance
The first step in renting out property is taking out buy to let insurance which ensures you are covered even if the very worst happens. Nearly a third of landlords have admitted using their own home insurance rather than a specialist buy to let policy, but this is questionable and can land you in all sorts of trouble if things go wrong.
As you are working as a business, even if it is only one property you are renting out, this kind of business insurance is required. It will cover a flat or house, fixtures and fittings, damage by tenants and even if it is a holiday home.
Specialist Landlord Insurance
Choosing a specialist landlord insurance policy is also important. As every house or flat is different the insurance price and what it covers will be too. Most policies will, but ensure malicious damage by tenants and rent guarantee insurance is covered in your policy. This allows you to recover unpaid rent and covers any costly damage caused.
Contents and landlord liability insurance are also vital and can be included in this policy or acquired separately. The contents element covers furniture and furnishings, but tenants need to take out their own insurance to cover personal possessions. Liability insurance keeps you in the clear if a tenant or visitor is injured in the property.
Landlord Buildings Insurance
Whether in a block of flats or a standalone home (caravan not included) landlord buildings insurance covers damage to the structure. This includes fire and flooding so is especially important in areas with a high flood risk. If the very worst happens it covers rebuilding a property, due to a hurricane or another disaster for example.
You will lose income as well as have to pay for repairs if your property is damaged significantly and left in a state where nobody can inhabit it. For these two reasons taking out landlord building insurance is a must.
Unoccupied and empty house insurance is also available and useful if nobody is using the property you own, even if it’s just for a short period of time. This too will protect your income.
