Insurance Guide For Tenants
Tenants should take care to review any existing policies when renting a property for the first time as some standard insurance products will either not provide cover, or may place restrictions on cover for rented property and/or its contents.
It is the responsibility of the landlord to insure the building and its contents, fixtures and fittings. The tenants are responsible for insuring any of their own possessions. There are specialist insurance products for tenants detailed below.
Tenants and landlords very often overlook this. Generally for the tenant who has paid the first months rent, deposit and administration fees in order to move into the property, insurance is the last thing on their mind.
Although a conventional home contents policy will give a basic degree of cover for most insured perils it is not specifically designed for tenants and there can be some major gaps in the cover you need. Often the minimum sum you can insure for will be far in excess of what the tenant needs, typically a minimum of £10,000 - £12,000.
Most specialist tenant policies will provide the tenant with cover starting from £2,500 upwards and will usually cover accidental damage that you may cause to the landlords fixture, fittings, buildings and contents.
Should the tenant accidentally damage the carpet with a wine stain or hot iron or a work surface with a hot pan mark, these events will be covered. Usually the tenancy agreement will make the tenant legally liable for such damage, any damage found at the time of the check-out will be deducted from the deposit or security bond.
If the tenant has adequate insurance these events will be covered, thereby protecting your deposit.
Recent studies have shown that less only 1 -20 tenants have any contents cover at all.
There are countless examples of tenants who have experienced a loss through, burglary, fire, flood or other insured peril, which has damaged their contents and have been horrified to discover the landlord has not insured their personal possessions. They have been left with the cost of replacing the items themselves.
Any items a tenant takes into the property it is their responsibility to insure. Most policies will give an option for basic cover which can usually be extended to cover high risk personal items which are taken outside the home, on holiday or Worldwide i.e. Cameras, sports equipment, clothes, jewellery etc.
In certain high-risk inner city post codes there will usually be a requirement to have minimum-security locks on doors and accessible windows
This type of cover will provide assistance for the tenant in the event of an emergency at the property such as:
Failure of the electricity supply
Failure of the cooking facilities
Leaking roofs or guttering
Security of doors and windows
Typical policies will provide parts and labour cover up to a specified amount and either the landlord or the tenant can call a 24 hour Helpline all year round.
If you have not taken a full management service from your letting agent or do not live near your property this can be a cost effective solution.
It should be stressed that all of these policies cover Emergency Assistance only and do not operate as a repair service for lack of routine maintenance.
(Source: ARLA, 2016)