An ever-growing complex of legislation, rules and regulations – not to mention the expense of keeping abreast of the demands these impose – makes life for the buy to let landlord increasingly difficult.
The confusion and the cost of complying with those demands is especially taxing for those 71% who might be described as “accidental” landlords, says a recent news story.
Whilst landlord insurance may not be a legal requirement – though may be obligatory as part of your buy to let mortgage contract – it is an essential safeguard in an increasingly tough environment. That makes saving money on your landlord insurance a priority.
Here are some tips and suggestions about doing just that:
- just as you would before making any important purchase, make a point of carefully shopping around;
- you need to make sure that the landlord insurance you buy is tailored to your specific needs and circumstances, covers all that you require, but leaves out anything you might not, and is, of course competitively priced;
Consult the experts
- since that shopping around is likely to prove more difficult than you first imagine – there are so many competing providers and packages, after all – you might want to draw on the expertise and experience of a specialist broker of landlord insurance;
- a specialist broker may be well-placed not only to advise on the cover likely to satisfy your needs, but also to offer among the most competitive quotes – so, helping you save money;
Consider your market
- the landlord insurance you need is likely to be influenced by your target market as far as tenancies are concerned;
- some insurers, for example, do not cover the risks involved when your tenants are drawn from groups such as students, the unemployed, welfare claimants or asylum seekers;
- if these are included in your potential target market, therefore, consider choosing landlord insurance providers who offer cover for any tenant group;
- tenants come and tenants go – during that interval between tenancies you are earning no rental income, of course, and so-called “voids” therefore need to be avoided;
- prolonged voids may also have an impact on your landlord insurance, since most policies stipulate that cover becomes severely restricted, or may even lapse altogether, if your let property remains vacant for longer than a month or so;
- in that event, you are likely to need further cover, in the shape of unoccupied property insurance – which, of course, involves further expense;
- like practically every other type of general insurance, your landlord insurance is likely to incorporate an excess on any claim you may need to make;
- by sharing the risks with your insurer and agreeing to a higher amount of excess, you are likely to reduce the cost of your premiums – but remember that this calls for a greater personal contribution to the settlement of any claim you subsequently make;
Avoid making many small claims
- since you’ve paid your landlord insurance premiums, you might be tempted to put in any small claim when something gets damaged or lost;
- try to avoid doing so, since a succession of small claims is almost certain to undermine your no claims discount – making next year’s premiums that much more expensive and, potentially, reducing your chances of securing the cover you need in the future.
Landlord insurance remains an essential safeguard for any buy to let landlord – accidental or otherwise – but fortunately there remains a number of ways in which you might save money on the cost of it.