Insurance

Whether you are just starting out with your first buy-to-let or you are an experienced landlord with an extensive portfolio, there are some important things to remember when buying and renting out property. These include insurance, solicitor fees, surveys and remortgages. While many landlords regularly look at remortgages to ensure that their investment in being managed cost effectively, it is easy to forget that having the right insurance policy in place can make a significant difference to profitability in the event of a loss.

Protecting the substantial investment that you have made is essential and this is why insurance is so important. When it comes to buying insurance, as when looking at remortgages, it is important that you select the right product. Landlord insurance is a specific type of property insurance that has been developed to meet the needs of property investors and buy-to-let landlords.

What is covered?

There are three main sections to a landlord insurance policy. Landlord’s building insurance covers any damage to the structure of the building. Different policies cover different perils, so it is always worth checking what is covered and comparing the various policies. It is also important to ensure that the sum insured under the policy accurately reflects the rebuilding cost in the event of a disaster.

Landlord’s contents insurance covers any damage to fixtures and fittings and is especially important to those who let out furnished properties. It is essential to ensure that this cover adequately reflects the value of the items in the property.

Landlord’s liability insurance covers any claims made by third parties for injury or property damage where the landlord has a legal liability. This will also cover the costs that the insurer incurs in defending any actions.

Additional Cover

In addition to the standard sections found under a landlord’s insurance policy, there are also a number of additional extras that it you can buy.

Legal expenses cover provides you with cover in the event that you wish to take action against your tenant. It will cover the legal costs incurred by the provider acting on your behalf if they have to take your tenant to court.

Rent guarantee insurance provides cover for periods where you are unable to obtain income from your property, either as a result of a tenant failing to pay the rent or for periods between tenancies. This guaranteed income can then be taken into account when calculating the cost of remortgages.

There are a number of financial considerations that landlords and buy-to-let investors need to take into account on a continuing basis, including remortgages, repair works and insurance. When it comes to insurance, it is essential to ensure that you have an appropriate policy in place that will meet your needs as a landlord and provide protection for your investment.?