How Does Property Management Insurance Cover Tenant Complications?
As a residential landlord, you will do your best to let to responsible, reliable tenants that will keep their rental property in good condition and protect yourself with the most appropriate property management insurance. In most cases, the relationship between landlords and their tenants is positive, and any issues with the property are quickly communicated and resolved amicably.
You can write into your tenancy agreement what responsibilities you expect from your tenants to help maintain high standards and how to report any property damage when it occurs. However, should something happen to the property and there is evidence that your tenants didn’t fulfil their agreement responsibilities, your insurance claim could be rejected.
Tenant complications are one of the leading causes of landlord’s insurance claims being turned down. This is why you should be careful to outline in great detail in your tenancy agreement precisely what you expect your tenants to be responsible for in terms of maintenance and general upkeep of their home, including any gardens and grounds, if applicable.
What Counts As A Tenant Complication?
Tenant complications can invalidate your landlord insurance in a number of ways. For example:
- Leaving A House Vacant Without Informing Insurers: Many tenants have families that live in other countries that they will want to visit regularly or work overseas for extended periods as part of their job. This will mean leaving your rental property vacant for long periods. As a landlord, you need to inform your insurer when your property is unoccupied for an extended period of time, and any insurance claims made for the property during this time may be invalidated. In most cases, insurers should be notified if the property will stand vacant for 30 days or more.
- Vermin or Pest Infestations: You will find that most insurance providers don’t cover the cost of treating pest or vermin infestations or the costs of any damage caused. This usually includes damage caused by rodents, birds and insects inside the property. While your insurance may cover accidental damage caused by a bird flying into a window and breaking a pane of glass, but it won’t extend to damage caused by an infestation, such as gnawing by rodents, holes or gaps created in walls or an infestation in the garden caused by neglect. You should make it clear in your tenancy agreement that tenants inform you immediately if they detect any pests or vermin. Then the responsibility of pest extermination will fall to you.
- Losing or Leaving Keys: While it is not unusual for tenants to lose or mislay their house keys, they should be actively discouraged from leaving their house keys in a vulnerable place, such as under the doormat or a plant pot. Should a burglar gain entry to the house using these keys, it will be considered an unforced entry, which isn’t generally covered on insurance policies.
- Leaving the House Unsafe: It can be easy to forget to close all windows before leaving the property, or fail to lock all the doors. But leaving the house unsafe like this will invalidate your insurance should a burglar gain entry through an open window or unlocked door. Even if you fit a burglar alarm, your insurance claim can be invalidated if the tenant forgets to activate the alarm when they leave the house in the event of a burglary. Taking steps to protect your property is a worthwhile investment.
- Property Renovations: Most residential landlords will perform some renovations or refurbishments to their rental property to meet health and safety codes and make it a desirable place to attract good tenants. Home renovations won’t usually affect your property insurance unless you plan to make some significant structural changes to the building. It is worth checking with your insurance provider before undertaking any major structural work to see if you need to amend your policy. It will also pose an added insurance risk while having builders on-site. You may want to take out extra cover during the renovation period to cover for accidental damage and added security risks.
Does Property Management Insurance for Landlords Cover Tenant Complications?
Residential landlords have responsibilities to their tenants while living in the rental property. These responsibilities include ensuring the property is safe and habitable for their tenants. Making sure the property remains safe and damp-free, and that any damage or hazards are quickly remedied is all part of being a responsible landlord. Ensuring your tenant’s deposit is protected in an appropriate deposit protection scheme until their tenancy ends is also a significant responsibility that needs to be fulfilled by UK law.
Other essential responsibilities include regularly checking and testing gas and electric appliances with an annual gas safety check and ensuring each floor has a working smoke alarm are other landlord duties that should never be neglected.
As long as your tenants hold up their responsibilities as set out in their tenancy agreement, your landlord’s insurance should cover you for any eventualities. Building insurance is the responsibility of the landlord. However, it is the tenant’s responsibility to insure their personal belongings with contents insurance if they choose to.
How Can Landlords Remain Insured During Tenant Complications?
There are ways to keep your landlord’s insurance valid during any tenant complications you are going through. These include:
- Keep Insurance Company Updated: Inform your insurance provider when your rental property will be vacant for an extended time, usually 30 days or longer. Also, keep your insurers informed of any property renovations you plan to undertake. It can help to take out extra temporary cover while the renovation is going on to protect you from accidental damage or theft.
- Ensure The Property is Secure At All Times: Educate your tenants about the importance of keeping the property safe. This includes closing windows and locking doors when leaving the property empty and immediately reporting any loss of house keys so you can arrange for the locks to be changed.
- When Vacant, Regularly Visit The Property: Should your rental property stand empty for extended periods while your tenants are away from home or when you are between tenants, make sure you regularly visit and inspect the property for damage.
As a residential landlord or property manager, you will have several responsibilities and duties to protect and maintain your properties from damage, whether accidental or deliberately caused by tenants.
Having the right insurance in place to meet your individual needs will be invaluable to protecting your livelihood from the risks associated with letting property.
At Brisco Business, we help landlords and property owners of all types and sizes to find the best insurance to provide the protection they need. Whether you are a landlord with one residential property or manage a portfolio of rental properties, our team can help you with all your insurance needs. Minimise financial losses and protect your investments with our robust business insurance plans at Brisco Business.
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