Incorrect Insurance (Thanks Pims)

9th May 2016

More than one in three landlords are not effectively covering themselves by opting for standard home insurance, leaving themselves wide open to the threat of damage to the property by rogue tenants and losing out.

The survey claims that 35.6% of UK landlords hold the wrong type of insurance rather than taking appropriate landlord policies. If their property is vandalised and or left empty then standard home insurance policies will not adequately cover them.

Thomas McCourtie, an analyst of the company that provides specialist financial services, feels that some of the blame must be taken by the insurer for failing to ensure that its customer takes on the correct type of insurance policy.

McCourtie said: “Insurers have a key role to play in educating customers about the necessity of purchasing insurance which corresponds to the intended use of the property. Quality checks can be implemented at the initial application stage or during the purchase process in order to identify properties that are to be let, and for the buyer to clarify which type of cover is required. This helps to ensure that the correct product is purchased.

“Given that rented accommodation has become the only real affordable option for many people, especially those living in large cities such as London, demand is high, and it is therefore important that the landlords supplying these properties are fully protected with the right cover. It also represents an opportunity for insurers to expand their coverage of the UK housing sector.”

Richard Merrick of PIMS says: “A lender has said that in less than eight years time the age of a first time buyer could rise to well over 40, this means that the private rented sector will play a major part in help the housing situation.

“ Rents will increase along with the standard of tenants, so we advise members that it is always best to seek out the best insurance policy that provides adequate cover for ‘peace of mind’ and damage limitation.

“After all landlords are running a business and most companies insure themselves to cover every eventuality.”