Tag Archives: landlords buildings insurance

Arranging landlords buildings insurance cover

November 26, 2012

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When setting up your buy to let business, it is almost certain that your greatest investment lay in the purchase of the property itself. Given the probable scale of such an investment, you are just as likely to want to do all that you to safeguard it by protecting the structure and fabric of the building against loss or damage – caused by such potentially major risks as flooding, fire, impacts, storm damage or vandalism.

Because it may safeguard the very core of a buy to let business, therefore, landlords buildings insurance cover typically forms a central part of landlords insurance.

Indeed, if a mortgage is involved in your purchase of the property, the lender is likely to be just as interested in safeguarding what is invariably a considerable sum by insisting that sufficient cover is in place as a condition of the loan.

What’s covered?

Both you and any mortgage lender, therefore, are likely to share a concern for exactly what risks are covered. Here, it may be important to bear in mind that not all policies offer the same degree of protection.

You may find, for example, that some insurers specifically exclude the risk of subsidence. Any major disturbance or subsidence of the building’s foundations, of course, might lead to considerable problems and major expense in putting things right

For extra peace of mind, therefore, you may wish to consider only those selected policies that are available (from specialist providers such as ourselves) and offer “all risks” protection, including the risk of subsidence.

You may also wish to check whether your chosen policy also covers the risk of malicious damage – whether this is caused by your own tenants or others.

How much to insure?

As may be clear from the description of some of the risks, building insurance is typically intended to cover incidents up to and including the total loss of the property (following a devastating fire, for example) and the subsequent need for its complete reconstruction.

This is the basis, therefore, on which owners typically base the amount of the total sum insured – the cost of rebuilding the property in a worst case scenario. Thus, if the total sum insured is an under-estimate (you are under-insured), there may not be a big enough settlement to rebuild the property; but if you are over-insured, you are likely to be paying more than rebuilding costs require in the event of a claim.

If you are concerned about any aspect of arranging adequate building insurance for your buy to let property, then please feel free to get in touch. At CIA Insurance we will be more than happy to help!

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Buying landlords buildings insurance cover

April 27, 2012

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When it comes to landlords buildings insurance cover, getting the balance right between economy, as measured by the premium and the levels of cover, may require a few minutes of your time.

That’s because the price of a let property insurance premium may not give you any indication of the levels of cover that it provides.

Different policies may typically appeal to different types of landlord and you need to find the policy most appropriate for you.

Reading through the detail may be the only way that you can be sure that the policy provides the cover that you expect for your letting property.

You may find, for example, that:

  • if you have a number of buy to let properties, you may be able to find a single multi-property policy, which is something that might make your life a bit easier by reducing administration. It may also possibly provide you with a more cost-effective solution for your insurance needs;
  • some policies may also be able to provide you with a contribution towards your  loss of rental income, should your tenants have to vacate your property because it has been damaged by an event such as fire or flooding etc;
  • policies may vary in the extent to which they may be offer financial protection in situations where you are being sued by a member of the public for injuries or damages that they claim are a direct result of some defect in your property. There are some policies that may be able to offer up to £5m of protection.

Remember too, if you plan to give your property a spring facelift, that your let property insurance may only provide cover while your property is tenanted and for only a limited period of time if your property is empty.

You may find that if your property if empty for a period in excess or 30 or perhaps 45 consecutive days (the period may typically vary from policy to policy) then your buy to let landlords buildings insurance may cease to provide cover. So if your refurbishment looks like it is likely to overrun, you may need to look into buying some unoccupied property insurance.

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What makes a policy the best landlords buildings insurance?

March 1, 2012

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Adverts for products proclaiming to be the best landlords buildings insurance may be very appealing to you but before you make any decisions about buying a policy, you may benefit from considering just what you mean by best and whether this matches what is being offered in the ad.

For example:

  • how much provision is there in the policy for public liability cover – some policies may be able to provide up to £5m;
  • is financial protection against subsidence included as standard in the policy – not all buy to let insurance policies may include this these days but given the amount of damage that subsidence may cause, it may be something that you feel strongly about;
  • what sort of landlords cover is on offer for situations where your tenants may have to move out while you carry out repairs on damaged caused by an insured event like a fire or flooding etc – some landlord house insurance policies may offer loss of rental income cover up to agreed limits;
  • are there any deals to be had if you are the landlord of a number of properties – some providers may offer property portfolio insurance, which may attract a discount and this may be a cost advantageous way for you to provide cover for all of your properties and help to reduce your paperwork into the bargain (this may typically be available if you have three or more properties but some providers may be able to provide this for you even if you have just two);
  • if you have a number of properties, you may also let to a number of different types of tenant so you may appreciate landlords insurance that does not exclude categories like students, DSS recipients or immigrants for example;
  • providers of buy to let cover may appreciate that what may be the best landlords insurance for you may not be the best solution for another landlord so no two policies are likely to be the same;
  • taking some time to find your best landlords buildings insurance by comparing what is on offer rather than just buying the first policy you see may help you to ensure that your needs and your property are adequately covered.
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Why is landlords buildings insurance required?

January 29, 2012

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As a landlord, you may be wondering why landlords buildings insurance is required:

  • insurance providers typically may not see your rental property as constituting the same degree of risk as one that is owner-occupied;
  • although they may see the risks as different, perhaps overall they may see that a property being used for income generation is at a higher degree of risk than one that is used by the owner for their own personal residential purposes;
  • as such, landlord insurance exists to provide appropriate cover for the different risk profiles;
  • the moment you commence using a property for the purposes of income generation, any current owner-occupier home buildings and contents insurance may become invalid and you may be in need of a let property insurance quote and subsequently, landlord insurance;
  • this principle typically applies even in situations where you may be continuing to inhabit part of your property but are renting out the rest (even where this is as little as a single room);
  • it may be worth noting that if you purchased your asset using a specific buy to let mortgage, your mortgage contract may require you to maintain all buildings cover at all times and that may, by default, oblige you to take out landlords buildings insurance;
  • landlords cover may also offer advanced protection for your contents and your third party liabilities – the latter relates to the risk that someone may sue you as a result of damage or injury suffered due to your property and win substantial damages through the courts;
  • under the umbrella term of landlords buildings insurance, there may be a significant number of different forms of insurance protection and the position may vary considerably from one insurance providers to another – shopping around to find a degree of protection suitable for your individual situation, may only be commonsense;
  • if your property appears to be in some danger of standing unoccupied for a significant period of time (typically defined by some policies as being 30 consecutive days or more) then you may find that standard landlords cover insurance will cease to be in force and you may require what is called unoccupied property insurance;
  • landlords buildings insurance exists to protect your interests and the investment you have made in your asset – it is a subject that should be taken seriously as one day it may be all that stands between you and serious financial difficulty.
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