Property Owners Insurance- more than just buildings cover

Redstones Financial

Redstones Financial

Buildings Insurance may be a requirement for lenders who advance money to finance buy to let property purchases. Many insurers will provide a basic policy that effectively covers the risk of fire however a Property Owners Insurance can be extended a little extra cost to provide so much more to the Investor.

Covers can include Loss of Rent and Alternative Accommodation, both of which are useful if you find yourself in a difficult situation with a claim. One of our clients had a drain blocked which caused water to come into the property through the toilet system, leaving as you can imagine quite a mess to be cleared up. The Alternative Accommodation on the client’s policy provided the cost for the tenant to stay in a hotel whilst the property was sanitized and made fit for habitation. Likewise, another client suffered loss from a burst pipe, the water created significant damage to the property, water brought some of the ceilings down, damaged flooring and walls. The property took 10 weeks to dry out to allow the property to be a position to be redecorated and carpeted for the tenant to move back in. The Loss of Rent on the policy covered the cost of the rent which the client did not receive, this was vital for to allow the Landlord to meet his monthly loan repayments which the bank still expected to be met.

Contents insurance can be added to a Property Owners policy to provide for cover for any appliances/ furniture/ carpets/ curtains which are provided by the Landlord. These wouldn’t be picked up by a standard buildings policy and can add up. Even a small amount of cover – say £2000 can be useful should there be a significant claim and the cost of the cover is very nominal to include.

Property Owners Liability really is a must for the Property Owner. It is not compulsory by Law but it protects the Owner for any claims against them for negligence or damage to other property or to people.  A client of ours received a claim for damages due to a tenant slipping on some water outside of a flat that they occupies which the claimant said was down to the Landlords oversight. The insurers put a £15,000 reserve as the tenant had fell and hurt themselves as a result. Injury claims really can add up and be a major issue if insurance is not in place to defend the claim or make a payment if the landlord is found to be liable.

We see quite a few claims coming in where properties have been broken into and damaged maliciously, often this involves reckless damage and theft of items like copper piping and fixtures leading to water damage.  Theft and Malicious Damage can be caused by tenants also and it’s important to check that your insurance policy provides cover for these risks.

Hopefully this highlights some of the issues that Landlords find themselves with and ways they can try to mitigate their exposure. A Property Owners Insurance from a Reputable Insurer can really help to reduce the risks. We are happy to talk to Property Owners who may have concerns and want to know how to protect them- please call  Claire Oakley on 08000 686 001 or email claire@a2ofs.co.uk

Redstones Financial Services ltd is a trading name of Acorn to Oaks Financial Services ltd, authorised and regulated by the Financial Conduct Authority, our number is 486131.