As with all insurance schemes, with landlord insurance there are certain additions to your policy that you can choose as optional extras. Most of the additions can prove vital if you ever need use of them, so do not dismiss them outright due to additional cost.
Rent guarantee is an option that guarantees rent to the landlord in a situation where their tenant cannot pay their rent, or if the home is uninhabitable (perhaps due to a fire or flood). It also covers you if your tenant refuses to pay their rent for multiple reasons.
When you compare landlord insurance, you should ensure that you check how long you are covered for with rent guarantee, or whether you will be covered up to a cost of a certain amount. There will sometimes be expensive excesses with some policies, so that’s another thing you will need to be aware of; your cover will be useless if you haven’t got the excess money.
Whether or not you spend the additional money and buy a rent guarantee option depends on your tenants. You should take into account how reliant you are on their rent payments, and maybe even the type of work they are doing – if you know that they have been unemployed for a long period and may struggle to pay, it’s always a good option to have.
The other additional cover you can get with landlord insurance schemes is having your legal expenses covered by your insurer, in the event of requiring legal help or advice. Landlords will, by the very nature of their business, be required at times to take legal action – whether it is because of a tenant’s refusal to pay rent, or to cover the cost of damage left on a property by a tenant.
Legal costs are generally extremely expensive, so if you feel that you may need it in the future (once again, with high-risk tenants as previously mentioned) then the addition is something that you may wish to consider when you compare landlord insurance.
Both of these options can be expensive depending on the company that you are buying your insurance from, and the area in which your property is, so make sure you know that you definitely want the additions before signing a contract.
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