Rent & Legal Expenses Insurance

With monthly rents averaging £793.00 across England & Wales* in 2016, most landlords would consider it a problem if their tenant(s) failed to pay. Nobody can predict the future and peoples circumstances change. Everything from redundancy to long-term illness or separation of relationships can affect a tenants ability to pay rent every month, so why would any landlord want to risk losing their income when there is also the likelihood of a buy to let mortgage payment to think about?

“I cannot understand why every landlord is not covered by rental guarantee and legal expenses insurance, and this is particularly important for ‘accidental’ landlords who are often as much potential victims of the recession as their tenants”.

Property Ombudsman’s Christopher Hamer -

Rent Arrears Facts

  • The unemployment rate for April to June 2016 was 4.9% but was 8.5% back in 2011. **
  • Currently 9.3% of all rent due has been confirmed “as arrears of one day or more”. ***
  • As of Q1 2015 there were 70,900 tenants facing more than two months of unpaid rent e.g. severe rent arrears. ****
  • The annual Let Alliance Landlord Survey (Dec 2015), 76% of Landlords stated they would like their rent guaranteed and all legal expenses paid for if tenant eviction was required.

Key Features

  • Nil excess as standard
  • 100% of rent arrears payable for a maximum of 15 months (up to a maximum of £50,000) or until vacant possessions (whichever comes first)
  • 75% of rent paid for up to 3 months after vacant possession is achieved
  • Covers the monthly rent up to £3,500 (up to 4 tenants but excluding houses of multiple occupation)
  • £100,000 legal expenses in order to obtain vacant possession
  • Available for all tenant types (including housing benefit claimants)
  • The insurance policy is held against the property (not the tenancy) allowing the tenants to change without an impact on your policy (subject to any new tenancies meeting the qualifying criteria below)
  • The cost of the insurance is fully tax deductible

Qualifying Criteria

  • We must be fully managing the property going forward
  • A deposit equal to a months rent or greater must be taken (we normally take a deposit equal to 5 weeks rent)
  • You must instruct a professional property inventory (mandatory if we are managing the property)

Price List

Length of Cover Price (inc. VAT)
12 months 3% + VAT of the annual rent (payable upfront)