Buy to let home insurance is an essential requirement for those that rent properties out to third parties, not only are you normally obliged to insure the building if you have a mortgage but it is also imperative to protect your investment. It is not possible to pass the onus of insurance on to your tenants; it is your responsibility to purchase the correct insurance for your building and for any of your contents that may be included within the lease.
For those new to the letting market a buy to let insurance quote will consist of a number of elements:
1. The first element is building insurance this is a normally a mandatory requirement if you have a mortgage whether you are leasing numerous single flats within block or a terraced house. The main things that this type of building insurance covers are permanent damage to the building caused by insured events listed in your policy, such as flood or fire. A full list of insured perils that you are protected against is stated in your policy documents.
2. You can also opt for contents insurance that will adequately protect items that belong to you in the property, this is usually non-fixed items such as household furnishings and appliances such as a fridge or washer or any other furniture should you be leasing a furnished property. This will protect the money that you have already invested in to your property as well as making it more attractive to prospective buyers.
3. The final aspect that will be included is property owner’s liability insurance this ensures that you’re protected should any person have an accident resulting in death or bodily injury in your property or third party property damage.
Many landlords wonder what the Buildings Sum Insured (BSI) is. Landlords are often asked to give an estimate for the BSI when in the process of obtaining an insurance quote. This is the estimate of the total cost of having to rebuild your property if it were totally destroyed. This is not to be confused with the overall value of the property being insured. This value is normally much higher than the BSI. If you give what you consider the value of the property, you will more than likely be paying much more for your buy to let insurance cover. It is also important not to directly underestimate the BSI. If this happens, in the event of a claim the insurers will reduce the amount that you are reimbursed for any damages incurred.
It is not always realized by landlords that they are not covered under their own home insurance. This type of insurance will not pay if the property is being used to generate income. One example of generating income is when you are renting property to tenants. As a landlord you must have a policy specifically tailored to a landlord. This is in the form of landlord’s insurance. Home owner’s insurance is also not rated for the circumstances that come about when you are a landlord. Many landlords are curious as to whether or not they need to take out multiple policies if they own multiple properties. The answer to this is no. You can obtain buy to let cover that is suited for many properties. It is very easy to get a quote for this kind of policy online. It will give you an estimate of exactly what you are dealing with.
Landlords need to keep in mind that when insuring properties, buy to let insurance will only cover items that are considered to be theirs. These items are supplied by the landlord for tenant purposes. Tenants will have to take out another type of cover in order to protect their own contents within a building. If contents are stolen during a break in, it is only covered if there are signs of forcible entry. If there are no signs of violence or signs of a forceful entry, contents will not be covered. When it comes to calculating insurance premiums, the same type s of criteria will usually apply. Insurers will want to know the location of your property, construction method employed, and postal code. You will be asked to give a rebuilding cost along with details of any claims filed in the past. If tenants are already living within your building, an insurance company may ask questions in regard to any tenants. Personal information is left out, but the insurance company will want to know if the tenants are working, students, or on benefits.
Confirmation is often needed as to whether the tenant’s agreement is between the tenant and you the landlord or a third party and the tenant. This will have a pretty big impact on your overall premium. If a property is rented to a housing association or local authority premiums will run higher. You can receive a buy to let insurance quote in a matter of minutes with us and if you find that it is right for you, then you can have your policy documents in a matter of minutes.
What Does Buy to Let Insurance Cover?
Most buy to let insurance for buildings and contents includes as standard:
Loss or damage arising as a result of fire, storms, floods, falling trees, theft, malicious acts or vandalism
Loss of rent receivable up to 50,000 following damage caused by an insured event
Legal liability as owner of the buildings for causing injury to others or for damage to their property up to 2,000,000 for any one claim
Loss or damage from escape of water , Home emergency cover with most buildings insurance you get up to 150 towards paying for call-outs or repairs if you have an emergency.
Please note that buy to let insurance is designed to cover certain unforeseen events and doesn’t cover everything. It does not cover things like general wear and tear or damage that happens gradually over a period of time. There is also an excess on each claim.