Landlord insurance claims: are you covered?

Buildings insurance

This covers damage to the property caused by, for example, fire, flood or escape of water. Specialist landlord buildings insurance would usually also cover damage caused by vandalism. In addition, it should include ‘loss of rent’, to protect against an interruption to rental payments because of a disaster such as a fire or flood. Buildings insurance is likely to be compulsory if you have a buy-to-let mortgage.

Landlords contents insurance

This covers any contents in the property owned by the landlord but used by the tenant – their own possessions would be covered by their own insurance. So this is particularly important if your property is let furnished. It usually also provides public liability which will help protect against compensation claims if someone is injured in the property.

Rent guarantee

This is different from ‘loss of rent’ and provides protection if a tenant defaults on rental payments. You would normally need a proper tenancy agreement in place with background references for your tenants in order to take out this cover.

Alternative accommodation

You may have a clause in your tenancy agreement which commits you to providing alternative accommodation if your property becomes uninhabitable. Cover for this can be added to your insurance.

Home emergency cover

This can be added to your buildings insurance to protect you and your tenants against loss of essential services or breakdowns.

There are several specialist landlord insurers to consider, as well as specific products for landlords from mainstream insurance companies. As always, it’s best to shop around, and most importantly, to read the small print on any insurance policy so you know exactly what you are – and are not – covered for.

Making a landlords insurance claim

Whatever type of insurance claim you make, it’s always a huge relief to get a speedy settlement. This is particularly true if you’re a landlord; delays can have severe financial consequences if they extend the length of time during which a rented property is uninhabitable.

This is why many landlords recognise the benefits of using a Loss Assessor if they need to make an insurance claim. It can be an overwhelming burden, particularly if the landlord lives a long way from the property, has an unrelated full-time job, or has multiple rented properties. Having to deal with a complicated insurance claim as well loss adjusters, surveyors and contractors, can be unmanageable.

A landlord’s insurance claim often entails far more than just the reinstatement of the property and replacement of lost or damaged contents. Using a Loss Assessor can make all the difference, particularly when it comes to some of the more technical aspects of the claim. These might include:

• Disputes over whether the landlord has met statutory obligations over equipment installed in the property.
• Dealing with the tenants themselves, particularly over whether they or the landlord are liable for elements of the claim. They may not have taken out the right insurance and may expect more than they are entitled to.
• The extent of lost rental income; what is covered and for how long?
• Alternative accommodation for tenants if the property is uninhabitable; should this be provided and, if so, who pays for it?
• Dealing with malicious damage caused by tenants; how do you prove this and how do you recover the costs?

Using a Loss Assessor means that a professional will take the whole process over and ensure the landlord receives what they deserve under the terms of their insurance policy, as quickly as possible.

In addition to the points listed above, if you decide to use a Loss Assessor to handle your insurance claim, then you should expect the following from them:

• Organising immediate specialist flood or fire restoration works and emergency repairs.
• Putting together the buildings, landlords contents and any other relevant insurance claim. This would include calculating and compiling a claim for loss of rent if insurance has been taken out to cover this.
• Handling all communications and attending all meetings with the insurer and their loss adjuster.
• Exploring with you all your options for reinstating the property, as well as helping to pick the best specialist independent chartered surveyor and building contractors. Alternatively, negotiating a cash settlement if you would prefer this.
• Supervising the surveyor and contractors carrying out the reinstatement of the property, ensuring you have a full say in how this is carried out.

Who pays for the Loss Assessor?

Typically, there are two options when it comes to paying the Loss Assessor’s fees:

• By appointing the surveyor and building contractors they introduce, the Loss Assessor will often not charge a fee to the landlord for managing the claim. The surveyors and contractors introduced will be on the Loss Assessor’s network of approved suppliers, and to be on this list, the companies pay a management fee to the Loss Assessor to manage the network. In Morgan Clark’s case, the companies approved to be on the network list are only those who adhere to our very stringent high standards, the companies are vetted regularly and there is thorough monitoring of their workmanship and professionalism throughout every claim.
• Alternatively, you may decide to choose your own builder to carry out the reinstatement work, or opt for a cash settlement. In these cases, you would be charged a fee based on a small percentage of the claim value.

By using the services of a reputable Loss Assessor, you should expect that they will more than offset their fees should they have to charge any.