Insurance/charity

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    Insurance/charity

    Does anyone know of any insurance companies who offer LL cover if the property is leased to a charity?

    Many thanks in advance.

    #2
    Are we talking residential rent to rent, in which case the advice is don't do it. However, I would hope that the charity would arrange insurance or give advice.

    If it is not for residential use, in what way is a charity higher risk?

    Comment


      #3
      Thanks leaseholder.

      The proposed set up is the charity lease the house for a set amount of time, guaranteeing rent, and then provide housing themselves to tenants (so, almost sub-letting i guess, with their target group being 'families at risk of homelessness'). But the normal insurance companies won't insure for this.

      Comment


        #4
        That's a rent to tent arrangement. Have you considered why you can't get insurance? The end tenants are people who would not be acceptable to private landlords.

        Comment


          #5
          Thanks leaseholder.

          You're right, I think there is an assumption that the end tenants are likely to be undesirable people (we might call them Chavs!!), when the reality is they're more likely to be vulnerable families, at risk of homelessness, due to having their properties repossessed.

          I guess it's human nature to make such judgements on people we've never met. It's a shame the stereotype exists, but exist it certainly does, demonstrated by difficulties in getting insurance for such partnerships.

          I suppose I was just wondering whether anyone on here was already working alongside charities/local authorities, as there appears to be a growing demand for this? And, if so, where do they source their insurance from?

          Comment


            #6
            It's not about making judgements on the end users of the property.
            It's not whether they're undesirable or somehow undeserving.

            It's about letting your property to an organisation for whom it is simply a place to house people they're trying to help.
            As many of them as possible for as short a time as possible.
            The organisation and the residents regard private landlords as part of the problem they're dealing with and will have no time and exert no effort in looking after the property.

            The reason you can't get insurance is that the risk of damage or loss is so high that it's not insurable at a rate anyone can afford to pay.
            Insurance companies aren't making value judgements, they're profit motivated actuaries.

            You'd be renting to an organisation, so the rules of an Assured Shorthold Tenancy don't apply, so there's a whole other element to managing the tenancy - which may also cause issues if the property is mortgaged.
            There's a risk of it being converted to an HMO by having three residents (just for a short time "in an emergency").

            Many people operate property leases like this - it's completely hands off and the income is (usually) reliable and regular.
            But it's not something that most landlords would contemplate.
            When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
            Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

            Comment


              #7
              We have covered a few of these in the past. Very difficult as per above comments but it is possible. The way we have got it through with our Insurers is to show some kind of stability with the tenant. If it is a house that is temporarily housing a tenant/family for a few days or weeks then this becomes extremely difficult to cover but if the house is used by the charity to provide a permanent long-term home for a family (i.e. 6+ months) then this gives us a good leg to stand on when trying to get cover. Getting the charity to confirm how they are using the property is a must.
              Steve Smith - Company Director at a leading Landlord Insurance broker with 20+ years experience in the industry
              LandlordZONE Verified Poster and Topic Expert for Landlords Insurance since 2009
              See my profile for contact details

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                #8
                I though it sounded a good idea when my agent said a charity was interested in renting my house, to house single mothers and I just let him get on with it. But now I've probably fallen foul of my insurance company.
                I did not realize I was entering into a lease, Did not see the lease as the agent signed it on my behalf. As the charity let out the house on six months shorthold tenancies I did not realize I needed to change my Insurance which I just allowed to roll over. Now I need to make a claim copper thieves have broken in and removed the gas boiler radiators pipework etc. I may find I am not insured at all. Also I have also just found out it is not unusual for their tenants to abandon homes leaving chaos behind so I would not recommend renting to charities at all

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