Landlord's insurance- how does it work when property is empty pending letting?

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    Landlord's insurance- how does it work when property is empty pending letting?

    We have moved from our previous home and plan to let it therefore we need to put Landlord's insurance in place.

    We don't yet have a tenant but the original insurance is up for renewal soon so it seems appropriate to get the landlord's cover in place early.

    Just to complicate matters we are in the final stages of enfranchising our freehold and up until now the leasehold house has been insured on our whole estate's buildings insurance. So we are wanting to insure the buildings and change to landlord's insurance at the same time.

    I made a couple of enquiries this morning but they want me to insure it as unoccupied whilst getting a tenant and then change it when tenanted. It was suggested I would get a refund when it became occupied but in all my years of insuring houses I've never managed to get any insurance company to refund any cash on a change of cover!!

    Can someone explain the best way of insuring the building plus minimal contents cover as a landlord?

    Thanks

    #2
    The problem you have is that it is empty now, so it would have to start as an unoccupied property insurance and you may only get limited cover (FLEA Cover) unless you pay for it which can be expensive and usually limited to 30 days.

    You will have to comply with the endorsements carefully as you will have to do certain things to ensure that the the policy pays out in the event of a claim. i.e. check on the property periodically, turn the water off or leave the heating on, seal the letterbox up or remove the post daily, and soon and so on.

    There are some insurers that will insure it as an unoccupied property and when it is occupied then they will change the level of cover to suit an occupied property this doesn't usually cost more.

    In future once it is occupied and insured as an occupied property, then it becomes unoccupied, you must inform your insurance, some insurances will cancel the policy, some will allow you a certain length of time to get a tenant some 30 days is normal but check your policy.

    Landlords policies come in all shapes and sizes,most should come with landlords liability but you can get accidental cover, legal cover, some legal cover is better than others, you can get rent cover in the event of a claim and you can get rental and legal cover if the tenant doesn't pay, you can even get cover if there is a claim and you want your own loss adjuster to act on your behalf who will fight your insurer for the best possible outcome.

    Not all the extras are expensive on their own but it can push the cost to cover one property up if you get all the extras.

    why your current broker want you to cancel the policy when it becomes occupied is because, that insurance will cover it on a different scheme so the policy has to stop and start under the correct scheme,this doesn't mean its a bad policy but a good broker should point you in the right area but tell them what you want as it will point them in the area of the best insurer that fits your needs.

    Hope this helps

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      #3
      Landlord insurance normally requires you to either visit the property at least once every 14 days (or have an agent doing the same, remember viewings don't count towards this) or have it let out. So depending on how far away you live this may be what you need to do.

      However, if I understand correctly then at current you have buildings insurance via your freeholder. So you won't need any landlord insurance at all before you find a tenant.

      If you let unfurnished then what you would need is

      (a) landlord liability insurance
      (b) fixtures and fittings insurance

      because buildings insurance is done via the freeholder and you don't need contents insurance as a LL if you let unfurnished. But there is no real use in getting this insurance before you already have a tenant.

      Once you have taken over your freehold and have registered it as the new owner with Land Registry and have received confirmation then you will need to set up your own buildings insurance in addition to (a) and (b) above, but not before. And maybe by then you already have a tenant so you can get all three together.

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        #4
        Thanks for you replies. It's clearer now.

        The freehold completion has been delayed again, it's been a long and rocky road, so no urgency yet to get buildings insurance in place. Contents are minimal too since we moved out. No tenant yet either! Hey ho!

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