| Why let property insurance may be important to you Posted: 01 Mar 2012 02:40 AM PST Here are a few key reasons why let property insurance might one day be critical your financial well-being: - typically, you cannot insure a property being used for the purposes of creating rental income with a standard owner-occupier home buildings and contents insurance policy;
- if you have a property being let out (or even if only part of it is being let out) and you subsequently need to make a claim under owner-occupier cover, you may find that your claim is rejected;
- the risks you face, as a landlord, may be significantly different in certain respects, to those faced by a typical owner-occupier and it is therefore important that you have appropriate insurance protection for those risks;
- remember that, as a landlord, you may be rather more exposed to third party liability claims than an ordinary owner-occupier, therefore, it may be important to have the higher levels of cover that may come with some landlord insurance;
- your tenants may also constitute a risk to you in other circumstances (e.g. malicious damage) in a way that there is no comparison for in the domain of owner-occupier cover, which is why specialist landlord cover is required;
- unlike an owner-occupier, your property is also your business and if you suffer a problem with it that means your tenants need to vacate the property, your income may go with them unless you have some form of a loss of rental income protection in place (something for which there is no meaningful equivalent in the context of owner-occupier buildings insurance);
- of course, in one way your property insurance may resemble that of an owner-occupier in that if your house stands empty for more than a period specified within the policy (typically 30-45 days depending on the provider) then it may require unoccupied property insurance if cover is to be maintained;
- if you have a buy-to-let mortgage, it may pay to keep in mind that the mortgage provider may have a clause in the contract that requires you to maintain adequate let property insurance at all times – unless you wish to be in breach of your mortgage contract.
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