Buy to Let Home Insurance

Buy to let home insurance protects your investment property against fire, floods and other common hazards. In addition, your policy includes the liability protection you require as a landlord if you are pursued for compensation by tenants who are injured or who lose property on your premises. Because your house represents an investment, buy to let home insurance secures your source of income and your financial future.

Average investors have begun to explore the financial potential of buy to let properties, and as a result, the number of these residences is growing. With a buy to let house, the property is purchased with the intent to lease the residence to tenants. If you are willing to take on the risks and responsibilities of being a landlord, you may eventually achieve considerable financial gains from buy to let homes. In addition, the interest you pay for a buy to let dwelling and the costs of maintaining the building may be deducted from your taxes.

Buy to Let House Insurance

When you purchase a buy to let house, your mortgage lender will require that you carry buy to let home insurance to protect the building itself against damages whilst you are paying off the mortgage. However, most owners of investment properties elect to continue their coverage after they've paid off the mortgage because the dwelling represents a source of income. The cost of replacing or repairing a building can be considerable, and the majority of property owners would prefer to pay home insurance premiums than to cover the cost of reconstructing their house.

When you compare home cover quotes, you will see that basic home insurance policies insure a building against damages caused by fire, floods, water or oil escape from pipes or appliances, falling branches or other objects, vehicle or aircraft collisions, forced-entry theft and vandalism. Unless you own an older home that has faulty plumbing or wiring, or problems with its foundation, buy to let home insurance should cover the building for its rebuild value rather than its market value. The rebuild value of a house represents the cost of reconstructing the dwelling on its original location, using similar materials to the original.

Buy to let home insurance may include coverage for the contents of your structure if it is a furnished or partially furnished building. Contents cover protects the movable items inside the building, such as carpets, drapes, appliances and furniture. An accidental damages option may be useful to replace carpets or furniture that are damaged by mishaps caused by tenants.

Multi peril home insurance includes all possible perils, with the exception of a list of exclusions named in the policy. Common exclusions include damages due to neglect or deterioration of the building, do-it-yourself projects, war and terrorism. As a landlord, you must maintain the property to ensure that minor damages -- such as broken windows or leaky pipes -- do not result in injuries to your tenants or harm to their belongings.

Buy to let home insurance may include cover for your building if it is left unoccupied for a period of time because you are unable to find a tenant. Home insurance for second homes and holiday homes typically includes the provision that the structure may be insured even if it is vacant. The terms of your contract may vary depending on whether you lease your dwelling to long term or short term tenants.

Liability Cover for Landlords

As a landlord, you must protect yourself financially against the costs of legal action if your tenants claim that they were injured on your property. Liability coverage protects your assets against the consequences of a serious injury or loss. If you employ a caretaker, a grounds keeper or other staff to take care of the dwelling or grounds, you must carry employer's liability cover in addition to buy to let home insurance.

Tenants are responsible for carrying their own home insurance to protect their furniture, electronic equipment, clothing and other belongings. Savvy landlords often require their tenants to carry a policy to avoid being held liable for losses or damages. Buy to let home insurance does not typically include the movable items that tenants bring into the dwelling, and tenants should be aware of this exclusion to avoid misunderstandings about who is responsible for their items in the event of a fire, flood or theft.

Buy to let home insurance is a versatile, comprehensive product that can be tailored to include all aspects of a landlord's business. Whether you own a small cottage in the countryside or a large multi-level dwelling in the city, you'll require adequate protection to ensure that your source of income is secure. Compare a quote from several trusted providers to find a product that covers all of your needs as a landlord.