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  • Guide to landlord liability insurance

    Landlord Liability Insurance

    Landlords renting out their properties to tenants are required to take out a landlord liability insurance policy to cover for compensation claims should someone injure themselves at your rented property.

    Landlord liability insurance covers any loss of income from rental properties caused by issues such as fire, theft, weather damage or if the rent is unpaid.

    In this guide, we look at exactly what landlord liability insurance includes and whether you need it for your property.

    What is landlord liability insurance?

    Landlord insurance covers you if your tenant or a visitor sustains an injury in your rental property. It protects you from any financial costs from unforeseen accidents, but it doesn’t negate the need to ensure your property is safe to live in.

    Do I need landlord liability insurance?

    If you own a property that you rent out to tenants in a residential home or commercial building, then you will require landlord liability insurance. Most buy-to-let mortgages also require that you have landlord insurance in place.

    Being a landlord comes with a large set of risks and responsibilities and landlord liability insurance is there to protect you from any legal claims that might arise. Standard home or contents insurance will not cover you if you are renting out your property.

    The insurance essentially protects you, as the property owner. So in addition to the standard insurances it also protects you from any financial losses connected to the rental. It covers loss of income from tenants refusing to pay the rent money, forced closure, and damage to the property.

    As a landlord, what am I liable for?

    As a landlord, you are liable to keep the property safe for your tenants, this includes:

    • The maintenance of the building and the land it stands on.
    • The electrics and plumbing of the property
    • The boiler. Ensuring it is safe to use and well maintained
    • Gas safety
    • Smoke alarms and other fire safety needed
    • Any fixtures or furnishings you provide are safe to use

    How much cover do I need?

    Landlord insurance can cover liabilities costing up to £10 million. The amount of cover you actually get is dependent on yourself and how much cover you think will need. When considering this you’ll need to think about optional extras such as legal cover on documentation/tax/tenant disputes, emergency cover, loss of rent or damage from tenants. Our expert insurance brokers will be able to discuss the options with you and help to advise on the level of cover you need.

    Landlord liability insurance products and optional extras

    As mentioned, landlord insurance is specifically designed for property owners that rent out their properties to tenants and can cover for loss in rental income, as well as covering for landlord liabilities. It is available to landlords who let out one or more properties within the UK or worldwide.

    Along with liability insurance, landlord insurance also covers the following:

    Buildings insurance

    Building insurance covers you for any damages to your rental building, such as vandalism or malicious damage, lightning, storm or earthquake damage, subsidence, burst pipes, fire, or smoke damage and oil or water impact caused by accidents.

    Contents insurance

    Contents insurance can be included with liability insurance. The level of contents insurance you need depends on if you are letting out a furnished or unfurnished property. Contents insurance can cover anything inside the property, such as damage to carpets, furniture, and electrical items. Landlord contents insurance can only cover the items you own inside the property and not the tenants. The tenants will need to source their own contents insurance cover to protect their own belongings.

    Landlord employer’s liability cover

    You can also include landlord employers’ liability cover in your landlord insurance, this will provide liability cover for any staff that they employ. It is only valid for workers who are directly employed by the policyholder.

    However, if you hire a contractor from an external company to carry out repairs on the rented property and they become injured, the contractor’s company should use their own liability insurance to cover their employees.

    Optional extras:

    The following optional extras can also be requested with your landlord liability insurance:

    Landlord emergency insurance

    Home emergency insurance protects your property with 24hr support should you need a call-out for any of the following types of issues:

    • Plumbing or heating issues
    • Roofing problems
    • Door and window problems
    • Drains, pipe and sewer issues
    • Infestations
    • Electrical issues
    • Lost keys

    However, when adding emergency cover to your policy, you will need to review what is included and excluded to ensure you have the cover you need.

    Accidental damage

    Most insurance policies cover damages that are caused by wear and tear or from natural causes and not accidental damage. You can add accidental damage to your insurance policy if you want to protect your property from issues caused by yourself from DIY building work or flooding caused by forgetting to turn the taps off, and so on.

    Legal cover

    Legal expenses up to an agreed amount can be added which will provide cover for any tenant disputes and if you are taken to court for personal injury or eviction.

    Loss of income

    This will cover you from any loss of rent whilst your tenant is still in the property but not paying rent. You will need to consider the cap on the monthly rent cover and the period it will pay out for, usually between six and 12 months. Loss of income insurance is mainly used when your tenant has gone into arrears and you are in the process of eviction which can take some time. It is considered a valuable safety net, especially in such a volatile market and some insurances will also even cover a few months after eviction whilst looking for new tenants.

    If you are unsure of the level of insurance you need, please contact one of our insurance brokers who will be able to help.

    Want to find out more about Bluedrop's Landlord Insurance?
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