Landlord liability insurance is the most important insurance you will ever buy. Liability insurance protects the landlord against any loss, damage or injury sustained by the tenant or their visitors while in the rental property. The insurance covers the landlord’s legal costs if the tenant files a personal injury claim.
Is landlord insurance a legal requirement in Ireland?
Although the residential tenancies act 2004 states that Landlords should have Property Damage and Public Liability cover in place for every unit they provide for private rental accommodation, it’s still not a legal requirement to do so.
However, most buy-to-let lenders require liability insurance as a contractual stipulation.
What does landlord liability insurance cover?
Landlord’s insurance protects the landlord against financial loss whereby damage is caused by the tenants, their guests or circumstances connected to the tenancy.
It protects you as the property owner from financial losses connected to the rental, such as theft, fire, or weather damage. It can also include coverage for unpaid rent and malicious damage by tenants.
What happens if I don’t take out liability insurance?
Not taking out some level of cover is not advisable. Any damage caused to the property by tenants or from issues arising connected to the tenancy will ultimately be the property owner’s liability.
Secondly, if a property is purchased on a buy-to-let mortgage and is damaged beyond a livable condition, it would need to be removed from the rental market, which could ultimately result in the revocation of the buy-to-let mortgage.
Types of landlord insurance policies available
This article mainly covers landlord liability insurance, but many different policy types are available.
As a landlord, you will want to review each policy type to decide what you need or don’t need.
The policies available are:
Buildings insurance
Buildings insurance covers the cost of repairing damage to the structure of your property and structures that are not the main dwelling, such as garages, outhouses and sheds. The cover will also extend to additional items such as the cost of replacing additional items such as pipes, cables and drains.
A good policy will cover the total cost of rebuilding your house.
Contents insurance
Contents insurance covers replacing or repairing your possessions if damaged, destroyed or stolen. It includes everything you would take if you moved home, including your furniture, kitchen appliances, curtains, bedding, clothing, television, computing equipment and jewellery.
Lost rent cover
Lost rent cover is aptly named as it protects you against rent loss. Different insurers have different definitions of lost rent and what amount they will cover, so it’s essential to check precisely what coverage you will receive in detail.
Unoccupied insurance.
Unoccupied insurance covers the uninhabited dwelling; this insurance will cover some/all of the rent if your property is vacant. The coverage and price depend on the property type/size and marketability.
Property owner’s liability
We have extensively covered property owners’ liability insurance in this article; It covers any damage incurred on the property or landlord.
Employer’s liability
Employer’s liability is significant because it protects your cash flow if, in the aftermath of an insured event such as a fire or flood, you may need your tenants to stay in a hotel, which will be covered (check the policy). If your tenants have to move out permanently or for an extended period, usually over 28 days, the costs of arranging alternative accommodation are also covered.
Property Insurance Ireland
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