Property Damage Doesn’t Have to Be A Costly Issue

Thursday, September 3, 2015
Property Damage Doesn’t Have to Be A Costly Issue

Property Damage Doesn’t Have to Be A Costly Issue

PRS Landlords Forced To Make
insurance Claims
Over Tenant Property Damage

Research by the National Landlords Association (NLA) suggests that over 400,000 private rental sector (PRS) landlords have been forced to claim on their landlord insurance policies due to rental property damage caused by tenants over the past 12 months.

The research indicates that almost 10% of private rental sector landlords have been forced to make claims on their landlord insurance policies for damage to rental properties caused by tenants over the last 12 months.It is estimated that UK PRS landlords already spend up to 5% of their annual rental income on landlord insurance policy premiums. However, the insurance premium tax is set to be increased to a new rate of 9.5% from November 6th 2015, impacting further on profitability, but the increase is expected to generate an extra £1.75 Billion (GBP) per year for HM Treasury.

Damage to rental property is one of the leading causes of tenancy disputes according to the DPS, so it is important that landlords or their appointed letting agent takes proactive measures to ensure that all new tenants understand their responsibilities when moving in to a new rented home.

A recent study discovered that up to 40% of PRS tenants were unsure of their responsibilities and unaware of what to do when it came to maintaining their rental property.

Tenants should be informed about what is expected from them with regard to minor repairs and general property maintenance not offered as standard by the landlord, such as cleaning windows, keeping gardens neat and tidy, regular mowing of any lawn areas, keeping drains and grids free from debris.

There are also specialist insurance policies for tenants to cover any damaged caused in rental properties that can help them avoid deductions from their deposit funds. Property repairs can be expensive and even if the damage was caused accidently it is still the tenants responsibility to pay for repairs, tenants liability insurance covers property damage up to £2,500 for just £60 per year.

NLA chairman Carolyn Uphill commented on the research, stating: “Property damage can be a costly issue for landlords especially if the level of damage exceeds the value of the tenancy deposit. We hear time and time again from landlords who have suffered because they failed to properly reference tenants before granting a tenancy, and it’s alarming just how many landlords find out the hard way, that a basic home insurance policy doesn’t provide the cover they need. It is of vital importance that landlords have the right landlord insurance policies and protection measures in place to prevent damage, as well as carrying out the necessary checks before taking tenants on”.

landlord insurance

This was written by Mike Clarke. Posted on at 10:30 am. Filed under Insurance. Tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink. Follow comments here with the RSS feed. Both comments and trackbacks are currently closed.