Rent Guarantee Insurance
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Why Compare Rent Guarantee Insurance Quotes With SimplyQuote
Managing properties is stressful enough, and the last thing you want to be doing is spending hours comparing different rent guarantee insurance policy quotes from various insurers.
At SimplyQuote, we understand how frustrating and time-consuming this can be.
Instead, you can use the comparison tool to compare rent guarantee insurance quotes in minutes. All you need to do is fill in a short form and you can compare quotes from 29 of the UK’s leading landlord insurers.
This saves you lots of time, removes the stress from the process, and the best thing is, it’s 100% free!
What Do You Need To Get A Quote?
To get a rent guarantee insurance quote, you’ll need to tell us:
- The number of properties you want to insure
- The type of property (e.g. house, flat, bungalow, or townhouse)
- The number of bedrooms in each property
- The type of tenants who live in your properties
- How long you’ve owned the properties
- Your average monthly rental income
- The length of the tenancy agreement or agreements
- Any claims you’ve made in the last 5 years
- Any previous tenant rent arrears
- If you want to include additional legal expenses
Why Do You Need Rent Guarantee Insurance ?
Whilst rent protection insurance is not legally required, it’s designed to help landlords financially whenever their tenants default on rent. It’s a type of insurance that can be added to your landlord insurance policy.
Tenants may default on their rent for a variety of reasons, it’s not always a choice. Policies such as rent guarantee, or buy-to-let insurance, are essential ways of protecting your income.
Thorough reference checks on tenants are not enough for landlords to feel secure. They don’t cover the possibility of unpaid rent arising from sudden job losses, illness, or economic shifts. Regardless of how detailed the referencing is, there are various factors out of your control that could impact your income.
The policy greatly benefits those who are going through lengthy legal processes to enforce rent payment or repossession of the property. The loss of rental income at this time can be colossal, but a robust guaranteed rent insurance policy can help through this time.
A rent guarantee insurance policy ensures you still receive the regular payments for your property while you wait for the tenant to clear their rent arrears or you go through eviction proceedings.
This will give you peace of mind and help you stay afloat during this uncertain time.
What Does Rent Guarantee Insurance Cover?
So, what is and isn’t covered by landlord rent guarantee insurance? Let’s take a close look:
What’s covered
- Loss of income: The primary function of a landlord rent guarantee insurance policy is to cover landlords when tenants default on their rent payments. It typically ensures you’re covered for up to 12 months of missed rental payments.
- Legal expenses: Many guaranteed rent insurance policies cover the legal expenses involved in repossessing a home, pursuing the payment of rent arrears, and other tenancy agreement disputes.
- Lost rental income from empty properties: Standard landlords’ rent guarantee insurance doesn’t protect lost income from empty properties, as the policy is designed to cover unpaid rent while the tenant resides at the property. This means that if the current tenants leave, rent guarantee insurance will not cover any future rent due.
- High-risk tenants: Depending on your specific rent guarantee policy, certain types of tenants may not be covered. This often includes tenants on benefits and students. However, this isn’t universal, so make sure you check the small print of your policy documentation.
- Houses
- Flats
- Blocks of flats
- Bungalows
- Townhouses
What’s not covered
What kind of properties does rent guarantee insurance cover?
Rent guarantee insurance covers residential properties. Generally, the types of properties covered by rent guarantee insurance include:
What Add-Ons Are Available For Rent Guarantee Insurance?
Guaranteed rent insurance is an add-on to a landlord insurance policy. Still, there are some further add-ons an insurer may offer you, such as:
- Legal expenses insurance: Your policy may also include legal expenses cover. Often sold in conjunction with rent guarantee insurance, this policy covers the legal fees required to take a tenant to court and repossess a property. This means you don’t have to stress about the potential financial implications of a legal dispute.
- Rental cover after eviction: Some insurers offer to cover you for a short period after the tenant is evicted. Usually, this includes paying 50% to 75% of your lost rental income for 2 to 3 months after eviction.
How Much Does Rent Guarantee Insurance Cost?
The cost of rent guarantee insurance varies greatly between different insurers and customers. However, you can expect to pay around £125 to £160 per year for cover.
This works out to around £10.41 to £13.33 per month.
What impacts the insurance prices?
- High-risk tenants: If the insurer thinks your tenants have a high risk of missing rent payments, your premiums may be more expensive.
- Level of cover: Your premiums will likely be higher if your policy covers 100% of missed payments rather than 50% to 75%.
- Rental costs: Generally, the higher the rent your tenants pay, the higher your insurance premiums will be.
- Property type: The size and location of your property will also affect how much you pay for your policy.
- Excess amount: The excess on your policy can have an impact on your monthly payments. In most circumstances, paying a higher excess means that your premiums will be lower.
How Can You Reduce Your Rent Guarantee Insurance Premiums?
Landlord rent guarantee insurance doesn’t tend to be massively expensive. Still, with all the other policies you likely have in place, it all adds up. So, let’s look at some ways you can reduce the amount you pay for your premiums.
Pay a higher excess
As mentioned, paying a higher excess is a good way to reduce the cost of your monthly premiums. This means it might be wise to pay a higher excess rather than a lower one.
Just bear in mind that this means the insurance payouts will be lower if you do need to claim.
Adjust rental income cover limits
It may sound obvious, but make sure your policy covers the exact amount of your rental income. Otherwise, you may be paying more than you need to.
For example, if your monthly rental income is £800 but you’re paying to cover rental income of £2,000, you’ll be paying extra for cover you don’t actually need.
Buy your insurance as part of a package
You may be able to reduce your premiums by buying rent protection insurance as part of a package with other landlord insurance policies. For instance, you could buy an insurance bundle that also includes legal expenses insurance and contents insurance.
Many insurers offer lower premiums for packages like these.
Screen and reference tenants
If your screening process includes income verification, credit checks, and references, the insurer is more likely to offer you lower premiums. This is because thorough screening and referencing are seen to reduce the risk of missed payments.
Pay annually
Most insurers offer small discounts if you pay your premiums annually rather than monthly. The savings may be fairly minor but it could still be worth it.
Compare quotes
Always ensure you compare quotes from plenty of different insurers before making a decision. This is the best way to find a deal that works for you.
How To Compare Rent Guarantee Insurance Quotes With SimplyQuote?
Comparing rent guarantee insurance quotes with SimplyQuote is quick and hassle-free:
- Fill in the short form: Tell us about your property and your tenants.
- Choose policy add-ons: Choose which additional cover add-ons you want.
- Compare quotes: Find a quote to suit your budget and insurance needs.
- Save money: Get the best deal to start saving today.
Frequently Asked Questions
Rent guarantee insurance is a policy add-on to landlord insurance policies. It helps landlords cover rental income when a tenant defaults on their payments – also called: tenant default insurance or rent protection insurance.
Most rent guarantee insurance policies require landlords to go through careful checks on tenants before signing contracts. This includes ensuring tenants have references from someone such as a previous landlord or employer, or ensuring they have a registered guarantor that will cover the rent if the tenant fails to pay.
This in addition to credit checks is an essential step in showing providers that you have done your duty to find reliable tenants. Always check the policy wording before signing up to make sure you get paid if needed.
When searching for landlord insurance, you want to compare quotes until you find the price that fits your budget. With the easy-to-use comparison tool, you can quickly find a landlord insurance policy that doesn’t break the bank.
Before picking a rent guarantee insurance provider, always compare the policies available to find an affordable route that works best for you.
If you rely upon rental payments for your regular income then guaranteed rent insurance will be indispensable. In an ideal world, thorough tenancy checks would be enough to protect your monthly rental income, however, there are too many variable factors involved.
With rent guarantee insurance, you won’t have to stress about a tenant’s rent arrears massively impacting your income, knowing that your provider has your back.