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A guide to insurance for new landlords

26th June 2022

Landlord insurance summary

  • Landlord insurance covers damage to a property you rent out.

  • It can also cover items in a furnished let, such as furniture and white goods.

  • It can include cover for non-payment of rent or legal expenses.

  • Your mortgage provider may insist on landlord insurance as a condition of your loan.

So, you’ve become a landlord, joining the 2.65 million people in Britain who rent out a property, according to the latest figures from HMRC*.

And while some may be wealthy investors with lots of experience and large portfolios, most people are new to it - just like you.

Perhaps you’ve moved in with a partner - leaving your own flat empty, are living away for work, or are letting an elderly relative’s house to pay for residential care.

You may have saved up a deposit, or possibly taking equity from your home, and are using a buy-to-let mortgage for a long-term investment.

Whatever your reasons for becoming a landlord, it’s not quite as simple as handing over the keys to a tenant and waiting for the rent to arrive in your account every month.

One of your key considerations is insurance, and the steps you need to take to protect your property.

This simple guide explores what you need to know about insurance for landlords - how it works, how to ensure you get the cover you need, and any pitfalls to watch out for.

Do I have to insure a property I am renting out?

The potential cost of repairs and even rebuilding makes not having insurance a huge risk, although there is no legal obligation to insure your property.

If you have a mortgage, your provider will almost certainly insist that the building is insured, as a condition of the loan.

A buy-to-let mortgage lender may specify that you need landlord insurance.

It is also worth noting that if you bought the property with a standard residential mortgage, you would need permission from your provider to rent it out - this is usually known as consent to let.

What’s the difference between buildings insurance and landlord insurance?

Buildings insurance covers the cost of repairs to your property if it is damaged - for example, by fire, flooding or storms. You should always check your own policy, but it does not usually cover anything you could take with you if you moved - such as furniture or carpets.

Landlord insurance also covers the structure of your home, but is designed specifically for rental properties, and may have extra features or optional add-ons such as legal expenses to cover the cost of evicting a problem tenant or dealing with deposit disputes.

As a landlord, which do I need?

You should consider your needs carefully before you take out insurance, and standard buildings insurance may give you the peace of mind you need.

However, the added complications of renting out a property may make landlord insurance more attractive.

For example, it may cover you if a tenant causes accidental damage to windows or floors, or for the cost of an emergency plumber to fix a leak.

If you have a mortgage, you should always check with your lender if a particular type of insurance is a condition of the loan.

Does it matter if my rental property is furnished or unfurnished?

Your tenant is responsible for insuring their possessions, so it is up to them to arrange their own contents insurance. However, if your rental property is furnished, you may want to make sure you are covered by landlord contents insurance to cover furniture, items such as blinds and curtains, and white goods such as washing machines and fridges.

Can I insure against other losses, such as non-payment of rent?

Landlord insurance can protect against other risks you may face, such a tenant failing to pay their rent, or legal disputes over contracts and tenancy agreements.

If damage to your rental property is so severe that it is uninhabitable, you could be responsible for the cost of alternative accommodation for your tenants - landlord insurance may also cover you for this eventuality.

Landlord insurance from TSB

TSB's Pick and Protect landlord insurance offers three types of cover:

  • Buildings cover with unlimited rebuild and repair costs.

  • Contents cover for furnished properties.

  • Starter contents cover if there are only a few items in your property.

You can even mix and match the cover, so if you have more than one rental property, you may choose Building’s cover for one rental property and Buildings and Starter Contents for another. It’s up to you.

There is also no extra charge for paying monthly.

Our landlord insurance covers loss of rent up to £100,000, and it is completely flexible, so you can amend your cover at any time.

And if you make a claim on one property, it does not affect the premium you pay to insure any others.

Click here for more info: Landlords Insurance | TSB Bank

TSB Pick and Protect Home Insurance is underwritten by Aviva Insurance Limited. You must be a UK resident and 16+ to apply. Terms and Conditions and exclusions apply.