Why should you buy landlord insurance?
Updated: Oct 22, 2020
Accidents happen in life – and so do begrudged tenants. If you’ve gotten this far, then you know that landlord insurance is something many people consider investing in for great reasons, however, if you’re still unsure then this should clear up some reservations.
Although it isn’t a legal requirement to invest in landlord insurance, it is something that many people recommend. There are multiple types of covers to invest in, and while this may be overwhelming for some, it doesn’t mean that you need to purchase all of them – just the ones you feel may be the best ways to protect yourself and your business.
Buildings insurance is ideal for those who are concerned with the destruction of their property, the great thing about this strand of insurance is that it includes abnormal weather occurrences under its cover – which is ideal because you can never account for the amount of loss that may result from extreme weather.
Alongside this, it also protects from the obvious: loss of rental income and property damage; if you’re concerned about the motives of a tenant, it may be worth exploring this as an option.
As it says in the title, contents insurance covers everything that is contained within the house – essentially, it protects your furniture and belongings.
While you may brush this off as unimportant, keep in mind that good quality furniture can easily be thousands of pounds to replace. We may not be able to predict the nature in which your furniture may become damaged by – because at the end of the day, accidents happen – but we can tell you that if you do need to replace anything, it can get expensive fairly quickly.
Finances are fickle, and bankruptcy or a loss of work can truly happen to anyone. It’s incredibly important to practice empathy if a tenant expresses to you that they can no longer afford their rent, so instead of making someone homeless, it’s important to have an open dialogue to consider options.
This may be when liability insurance becomes a worthy investment. If a tenant does declare bankruptcy, then you will be protected under this strand of insurance which should help you stay financially afloat.
Liability insurance also covers any faulty issues within the property, which when you consider the age of older properties, you may understand that faults are more common than you think. A loose wire or faulty plumbing can quickly become an extortionate issue under the pressure of everyday usage.
Investing in any – or all – of these types of insurances very clearly have their benefits, however, it can rack up quickly into an expensive luxury that you may not be able to sustain. That’s why a lot of companies offer bundles or deals, that way you get the full package at a reasonable price.
We know it’s an extra added expense, but it’s worth it when compared to all the money you could pay out if something were to go wrong.