How Much Landlord Liability Insurance Do I Need?
The amount of landlord liability insurance that a landlord needs will depend on several factors. While policies are commonly available in the range of £2 million to £5 million of coverage, many professionals advise landlords to get £5 million of protection at a minimum.
Insurance site NimbleFins said, “Injury claims are rising, so landlords will be better protected by taking out higher levels of landlord liability insurance. Claims for injury or vehicle damage are more common than you might think. Luckily it’s cost-efficient to increase the limit of insurance. For example, doubling the coverage will not double the premium you need to pay. For example, if an insurer quoted £55 for £2 million of cover, a policy with a higher limit of £5 million would likely cost less than £100.”
The liability element of most landlord insurance policies range from £2 million to £5 million of coverage, but it may be best to seek professional advice to determine the correct policy limits. Without the correct coverage, a landlord’s personal property and assets could be at risk, so it is important to have adequate cover in place.
Even though landlords may be personally at financial risk if any claims are made, there is no legal requirement for property owners to obtain landlord liability insurance. While the law does not insist on coverage, most landlords recognise that there are several possible areas where claims may be made against them and opt to purchase protection. Whether renting a single property or multiple properties having insurance cover in place makes sound business sense.
What do landlords public liability insurance cover?
Landlord public liability insurance, also known simply as landlord liability insurance, covers situations where a tenant or visitor to the property (e.g. a third party) is injured, or their property is damaged, and the cause is your negligence.
For example, say there’s an uneven step leading into the property. If someone trips on the step and falls, injuring themselves, they could sue the property owner.
How much is landlords public liability insurance?
Public liability insurance for landlords starts from just over £50 a year for around £2 million of coverage. Policies with a higher limit of insurance would cost a bit more.
Instead of buying landlord liability as a standalone policy, it is often sold together with building insurance as part of a landlord insurance package. When purchased this way, a discount might be given, essentially lowering the landlord public liability insurance price.
Combined building and liability insurance for a landlord typically starts from around £200 a year, but costs will vary considerably. Building insurance rates are primarily based on the rebuild cost of a property, so properties with a higher rebuild cost will cost more to insure.
Landlord building insurance typically covers loss or damage due to covered events like fire, flood and burglary. Building insurance protects the main structure, including plumbing, electrics and built-in electrics.
Contents insurance, which protects items like furniture, furnishings and removable appliances in case of similar disasters, would usually be an extra cost. Landlord contents insurance would not protect the belongings of the tenant, however. Tenants need to buy their own contents insurance.
Other insurances that may be added to landlord insurance can protect against things like non-payment of rent or wilful or accidental damage to the property. Policies can also be added that protect empty properties from harm from things like fire or flooding. Cover can also be obtained to shield from malicious damage due to break-ins or vandalism.
A landlord insurance package provides the advantage of holding all insurances under one main policy, eliminating the need for tracking several different monthly premium payments. It also provides the benefit of renewing everything at the same time as everything is held under one umbrella policy.
The cost of empty property coverage is often higher as the risk of damage from fire or water may be undiscovered for a longer period in empty properties. As a result, the damage can be worse in an empty building than in an occupied building.
Is landlord liability insurance the same as public liability insurance?
Landlord liability insurance is essentially a form of public liability insurance. They both protect against bodily injury or property damage claims made by third parties. In the case of landlord liability insurance, this covers situations where the property owner is deemed to be responsible, for instance, due to negligence, like not maintaining a property to safe standards.