How Much is Landlord Insurance?

Owning rental properties is an exciting venture, but with it comes the responsibility to protect your investment. One of the best ways to do this is with landlord insurance. If you’re wondering how much landlord insurance costs and what it covers, this guide will help you understand everything from basic buildings insurance to rent guarantee insurance.

What is Landlord Insurance?

Landlord insurance is a special type of policy designed to protect property owners who rent out their homes. Unlike ordinary home insurance, it covers the unique risks involved in renting, such as accidental damage by tenants or loss of rent. Landlord insurance policies can vary, but most offer a combination of building insurance, contents cover, and liability cover.

What Does Landlord Insurance Cover?

The cover you get depends on the level of landlord insurance you choose. Here are some common features:

Buildings Insurance: This covers the cost to repair or rebuild the structure of your property in the event of a fire, flood, or other damage. The rebuild cost is something insurance companies will assess when calculating your premiums.
Contents Insurance: If your property is furnished, Landlord Contents Insurance will protect items like sofas, beds, and appliances against damage or theft.
Accidental Damage: This covers unforeseen events such as a tenant accidentally breaking a window or damaging flooring.
Liability Cover: In case someone gets injured on your property, legal costs and compensation claims will be covered.
Loss of Rent Insurance: If your property becomes uninhabitable due to damage, loss of rent cover ensures you don’t lose out on rental income.

Why Do You Need landlord Insurance?

While not legally required, having landlord insurance is crucial for financial protection. Rental properties are exposed to various risks—whether it's damage by tenants, malicious damage, or even legal expenses associated with disputes. The cost of landlord insurance is a small price to pay compared to the financial burden you could face without proper cover.

Types of Landlord Insurance & How Much They Cost

The cost of landlord insurance depends on the type of property, its location, and the level of cover you choose. Here’s a breakdown of common landlord insurance types and their average cost:

Building & Contents Insurance

This is the most common type of landlord insurance. Buildings insurance protects the structure, while contents cover protects items you provide, like furniture.

Average Cost: £150 to £300 annually, depending on the size and location of the property.

Boiler Insurance & Cover

Boilers are essential, and repairing or replacing one can be expensive. Boiler insurance ensures that you’re covered if something goes wrong.

Average Cost: £90 to £200 per year.

Maintenance & Home Emergency Cover

If there’s a plumbing issue or an electrical fault, home emergency cover will provide 24/7 assistance for urgent repairs.

Average Cost: £50 to £150 annually.

Rent Guarantee Insurance

Rent guarantee insurance covers you if a tenant stops paying rent, and it can also cover the legal expenses if you need to evict them.

Average Cost: £50 to £140 per year.

Loss of Rent Insurance

Loss of rent insurance ensures you’re compensated if your property is uninhabitable due to damage.

Average Cost: £20 to £50 extra on top of your standard policy.

Do You Need All Types of Landlord Insurance?

Not every landlord needs all these types of cover. For example, if your property is unfurnished, you can skip Contents Insurance. Similarly, boiler cover or home emergency cover might not be necessary if you have a newer boiler or feel comfortable handling maintenance issues yourself.

However, some types of landlord insurance are highly recommended for most property owners:

Buildings Insurance: Essential for protecting the structure of your property.
Liability Cover: Protects you from legal costs if a tenant or visitor is injured on your property.
Rent Guarantee Insurance: This is crucial if you rely on your rental income to cover your mortgage or other expenses.

Optional extras like boiler insurance, home emergency cover, and loss of rent insurance can be added based on your personal needs and risk tolerance.

Total Annual Cost for Comprehensive Cover

If you choose most of the types of cover, the total annual cost for landlord insurance could range between £360 and £840. This estimate includes:

Building & Contents Insurance: £150 to £300
Boiler Insurance: £90 to £200
Home Emergency Cover: £50 to £150
Rent Guarantee Insurance: £50 to £140
Loss of Rent Insurance: £20 to £50 (add-on)

This provides a general idea of what you might expect to pay for full coverage, but landlord insurance costs can vary depending on factors like location, property size, and your insurance provider. Always shop around and get landlord insurance quotes tailored to your specific property to find the best deal.

Key Points to Consider

Before finalising your landlord insurance policy, here are some important things to keep in mind:

Costs are averages and estimates: The figures provided are typical ranges, but the actual cost of landlord insurance will depend on your property type, location, and the level of cover you choose.
Building insurance is the bare minimum: If you're a landlord, buildings insurance is essential. Everything else, such as contents cover, boiler insurance, or rent guarantee, is considered extra.
Single policy vs separate: You can either opt for a comprehensive single policy that bundles different covers or take out separate policies for different types of cover. Be sure to compare which option provides better value for your needs.
Always shop around and compare: Don’t settle for the first quote. Compare policies from different insurance companies to ensure you're getting the best cover for your money.

Final Thoughts

Landlord insurance is an essential tool for protecting your investment, whether you rent out a single property or manage multiple rental properties. While not every type of cover is necessary for every landlord, the right combination of building insurance, contents insurance, and rent guarantee insurance can provide the peace of mind you need to manage your property confidently. By choosing the right level of cover, you’re safeguarding against potential risks like accidental damage, unpaid rent, and even legal disputes.

If you’re a landlord approaching your insurance renewal and considering whether it’s time to sell your property, Upstix can help. With Upstix, you can skip the hassle of the traditional property market and sell quickly and securely. By using smart technology, Upstix offers a fast, fair cash offer, allowing you to move on without the long wait.

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