Unoccupied property insurance for landlords

Finding the right tenant can be a daunting process. The ideal tenant should be respectful of the landlord’s rules, keep the residency clean and tidy and of course, pay their rent on time. If all goes well and an ideal tenant is secured, then renting out a property can be very profitable.

But what happens when your property is vacant for an extended period of time? And is the property covered by your buildings and contents insurance during this unoccupancy? Have you ever been inside a neglected or misused property and felt the itching desire to get your marigolds on and give it a thorough clean? 

Why might your property be unoccupied between tenancies?

Landlords will often experience a short gap between tenants moving out and others moving in, but it’s when gaps stretch into weeks or months, that makes landlords uneasy. There could be several reasons why your property might be vacant between tenancies, so it is worth looking at all possibilities to ensure you fill the occupancy as soon as possible.

Rent is too high: As a landlord, you need to be charging a reasonable amount of rent on your property to cover the costs of the mortgage, bills and to make a profit. However, if your property has been sitting vacant for a while, then it might be worth reviewing your rental costs. For any rental costs, you need to consider the location of the property, it’s condition and size, to make sure everything is relative and so you are not scaring away any potential tenants.

Condition of the property: If you find your property is lying empty for some time, then take the opportunity to update and make any repairs that could make it more desirable. Of course, with any rental property, landlords need to be careful not to spend more than it is worth, but making small changes such as painting walls, replacing carpets and updating the white goods, could make your property look more appealing.

How is the property being marketed: As a landlord, you may be managing your property yourself, in which case you’ll need to market your property in the most effective and efficient way. Ask your self - are you promoting your property on all the right websites? Are you providing potential tenants with the right information and quality photos? It’s recommended to review your marketing strategy regularly as keeping the information fresh and relevant can boost interest. If you are not managing your rental property, then you most likely have an agency doing this for you. 

If your property has been sitting vacant for a while, then review what your agency are doing and ask them to tweak their strategy. If their improvements are not working, then it might be time to find yourself a new agency.

What can happen when a property is empty for a prolonged period?

The most obvious problem landlords face when their property lies vacant, is the loss of income. For many landlords, renting out their property is a means of making a living, with the rent paid by the tenants covering the cost of the mortgage, bills, property taxes and profit.

In some cases, landlords may be eligible for discounted council tax rates on an empty property, but that can all depend on your council. More information can be found here.

If your property is likely to be vacant for a long period of time, it might be worth shutting off your utilities such as electric, water and gas to not only reduce your costs but to remove any potential risk of leaks or other hazards. However, you may want to leave your thermostat on at a low temperature during winter, to ensure your pipes do not freeze. It is also worth checking in on your property regularly to ensure no other potential issues develop such as damp, roof damage, break-ins and unwanted squatters.

How does property insurance work for landlords?

One of the first things any landlord should consider when renting out a property, is to check it is covered with the relevant property insurance. Regular home insurance is different to second home and rental property insurance, so consult with your insurance provider to make sure all your bases are covered. Will you be covered for accidental damage? Do you require contents insurance or just buildings? Do you need liability cover?

By protecting your rental property, landlords are covered for most eventualities, however when your circumstances change or changes are made to the property, it’s good practice to always update your insurance provider as the wrong information on record could deem your policy invalid or mean a claim is denied.

There are also ways in which landlords can reduce the cost of their insurance policies, which may include:

Keeping the property in good condition and making any repairs quickly.
Increase security measures on the property e.g. installing British Standard locks on doors and windows.
Your claims history e.g. the more claims you have made in previous years might mean you are paying more.

Most insurance providers will cover an unoccupied property for either 30 or 60 days but for anything longer, landlords should contact their insurance providers so their property is always adequately protected.

At Guardcover Unoccupied Property, we can offer insurance for landlords who own a Freehold property, a Freehold property owned in its entirety, a Leasehold property who are legally responsible for insuring the buildings, and a Leasehold property but who are not legally responsible for insuring the buildings.

Our cover includes protection against damage caused by the following:

Accidental damage and malicious damage
Theft and attempted theft
Escape of water or oil
Fallen trees
Storm, flood, fire and subsidence
£5million property owner’s liability
Damage to locks following theft, attempted theft or loss of keys
Trees felling or lopping
Fly tipping
Finding the source of a leak
Breakage of glass

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