Buy to let home insurance is just as important as your personal house insurance policy. Although some tenants are diligent in reporting problems, landlords realize that some tenants do not watch as carefully for potential problems as you would, which means your rental unit has much more exposure to hazards than the typical home. Needless to say, insurance providers realize this too. That’s why buy to let home insurance usually costs more than a average homeowner’s policy.
The simple fact that the landlord doesn’t reside on the premises and rents the house or apartments also implies the home is more likely to be vacant than the normal homeowner’s dwelling. While you may have excellent tenants whom remain for a long time, at some point in time they’ll move out and regardless of how well they looked after the house, there’s usually work to do before the next tenant can move in.
Needless to say, the loss of a tenant means the house will probably be empty until such time as you finish the work and locate the next good renter. Again, this exposes the home to all the more dangers from vandals to water damage if a pipe would break with nobody near to discover the trouble for a while.
Buy to let home insurance companies won’t pay a claim if the property has been empty for as little as 30 days in some states or slightly longer in others. It all depends on the carrier and your state laws. In order to be positive that you have full coverage, get buy to let home insurance policies that offer a rider for these times the house is empty. It extends coverage while you are doing repairs, locate just the right tenant, and is very well worth the extra premium.
The option to a rider for your buy to let home insurance is to switch to a builder’s risk policy when you’re refurbishing the property. However, these may be costly and frequently quite difficult to get. Talk about this issue with your insurance representative so you aren’t stuck at the last minute trying to find insurance or worse yet, file a claim and find you had no coverage simply because the dwelling was empty.
Make certain that you have adequate coverage on your policy. Similar to homeowner’s insurance, insurance providers prorate all claims if you don’t insure to 80 % valuation of the house. While you might have only paid $50,000 for the home 20 years ago, today it could be worth considerably more if you sold it, particularly if you have made improvements in the property.
Presume you’ve got a $100,000 property that you just only insure for $50,000. In the event you have roof damage from a storm estimated at $3,000 for repair, first the buy to let home insurance company estimates the amount of money they pay. Since you only insured for half the value of the house, they only give you half the expense of damage or $1,500. The company then subtracts your deductible from that value. In the end, you’d only receive $500 in the event you had a $1,000 deductible. Had you insured the property for $80,000, 80 percent of the value, you’d get $3,000 less the deductible. There’s quite a spread between the two amounts.
Make certain you’ve adequate loss of rent coverage in your buy to let home insurance. In some instances, the loss of rent can make a difference in whether or not you’ll make that next payment on the home on time or struggle and pay penalties to your lender.
Some buy to let home insurance policies have liability in the policy but you’ve got to add it to other policies as a rider if it is even available. Many individual home owner insurance policies offer a rider that provides liability coverage for a rental or other property. In the event you have many properties, an umbrella liability policy might be the best bargain for your needs. Discuss this together with your agent for the best solution.
Check out the many options that you can find online for cheap contents insurance and buy to let home insurance.