Being a landlord isn’t easy. It’s effectively like having a business which is open 24/7. Your customers are always in the shop and you – or your agents – have to be at their beck and call to sort out any problems as quickly as you can.
For this reason, landlords need a bit of help, which is where insurance comes in. Just as with any other type of business, landlord insurance is there to protect, to help, and to alleviate some of the worries that go hand-in-hand with running a business. Here are three of the most common ways in which this happens.
We often hear stories in the newspapers about nightmare landlord and houses that are all-but falling down. It’s also true however, that nightmare tenants aren’t as rare as one might hope and unfortunately a bad tenant can do a lot of damage to a property. If a landlord does end up with a bad tenant, not only will they have to ensure that their property is repaired before they can let it out again but they may also have to spend money on legal fees trying to recoup unpaid rent or money for stolen and damaged items. In these types of situations, landlord’s insurance – depending on the terms of your policy – will cover the cost of damage to the property and items contained therein, this may also help to mitigate any resulting legal bills.
Acts of God
The term ‘an act of God’ refers to any event that could not have been caused or controlled by humans. It’s usually used in cases of natural disasters such as: floods, lightning, hurricanes etc. It’s very difficult to predict these types of events or guard yourself against them.Insurance will give landlords some peace of mind in knowing that, if an act of God did occur, their insurance would cover the cost of repairing the damage.
Loss of Business
A rental property is a business and provides income for the owner. If business is interrupted for any reason that isn’t the property owners fault, this can result in a loss of rent and therefore income. The property owner’s livelihood would therefore be destroyed. Luckily, most landlord insurance policies make provisions for this type of situation, offering cover against loss of rent and even providing alternative accommodation options for tenants. The result – happy tenants and a landlord who is able to keep earning a wage.