What is Landlords' Buildings Insurance?
As a landlord you typically have a Buy-to-Let Mortgage. Just like with a residential mortgage, your lender will insist that you have suitable buildings insurance in place. Even if your fortunate enough not to have a mortgage, unless you can afford to rebuild your investment from scratch, you should have suitable buildings insurance in place.
Remember, all landlords must have Building’s Insurance in place when they exchange contracts on a property. While the landlord takes responsibility for Landlord’s Buildings Insurance, your tenants may choose to take out their own Contents Insurance policy to cover personal possessions.
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Things to Remember
Your cover is based on what your investment property would cost to rebuild. You can check whether you have enough buildings insurance using the handy online tool on the Building Cost Information Service (BCIS) website. Here you can calculate the sum you should insure your building(s) for, in case your home has to be entirely rebuilt. Often you can find the rebuild costs of your property on the valuation or survey report.
You need to tell your insurer if you extend your property, for example with a loft conversion or conservatory.
Your belongings are not covered – these need to be covered separately with contents insurance.
If you let your property on a furnished basis, you should check with your adviser what is covered as landlords contents insurance is normally much more restricted than standard home contents insurance policies.
Keeping the Costs Down
Often, insurers will offer a better deal if you purchase buildings and contents insurance together. Most policies have a standard excess charge which means you agree to pay the first part of any claim, for example the first £100 or £150. If you agree to pay a higher excess, you might get a cheaper policy.
Always compare what’s covered by a policy, not just the price – the key policy information or a good adviser will help you do this. Some might be cheaper than others, but they may not offer the same level of protection.
Benefits may include:
- Accidental Damage Cover
Includes cover for accidental breakage of fixed glass, fixed sanitary fittings, ceramic glass in cooker hobs of built-in units, fixed solar panels, cables, underground pipes or tanks serving your property.
- Building Cover
Cover for the home and fixtures and fittings, garden walls, hedges, paths, drives and patios, car ports, permanent swimming pools built of brick, stone or concrete and any outbuildings.
Maximum discount offered: 1 year – 5 years. NCD can also be protected on some policies.
- Legal Liability
Up to: £2,000,000
- Metered Water
Up to: £1,500
- Loss of rent or costs for alternative accommodation – up to 20% of the sum insured.
Please contact us the details we need to you with a personal quote.