Tenants’ liability insurance, you say?! You may not have heard of it before, but the chances are that if you’re a renter then you’ll be asked to get it before long. Self-confessed insurance enthusiasts that we are, we thought that we’d give you guys the lowdown on this lesser-known insurance plan popping up around the UK.
What does it typically cover?
As a general rule, it covers you if anything belonging to your landlord gets damaged, ranging from things as small as a stain on the carpet, or a broken lamp, to more serious operations like broken windows or burst pipes. It’s particularly helpful for people living in pre-furnished properties, as there’s so much more to damage.
The cover is typically for accidental damage only, which is likely to be the most common thing going wrong, though some of the more expensive policies will also cover you for your liability in causing any fire, theft or flood damage (think knocking over a candle). No policy will ever cover you for wear and tear, or any damage caused deliberately or through negligence.
How is this different from my security deposit?
Tenant’s liability insurance isn’t a replacement for your security deposit.
The cover is designed to reduce the risk that you will lose your deposit, by paying out for some of the most common causes of a landlord keeping your money at the end of the tenancy. It’s worth noting though, that you shouldn’t leave it until you move out to make a claim, as most insurance providers give a maximum of 30 days since the incident for you to make one.
Notably, the landlord may choose to keep part of your deposit if you haven’t paid all your rent, or utility bills, or don’t leave the place sufficiently clean, and these things are not covered by the insurance.
What are the different ways to buy cover?
There are two main ways to buy cover; as a standalone policy, or as part of a home contents insurance policy.
It’s usually better value to buy a home contents policy, with tenants liability included, because it usually isn’t much more expensive, often gives a higher level of cover for Tenant’s Liability, and of course you also get cover for all of your own property.
Standalone cover is usually best for people who don’t have many possessions of their own, and just want to be sure they won’t lose their security deposit, or are being compelled to buy something by their landlord or letting agent.
Decided tenants liability insurance is the way to go for you? Check out our policy which gets you £5k cover for just £40 per year.
Can a letting agent force you to get it?
In recent years it’s become common for landlords and agencies to demand you get tenants’ liability insurance. Normally this would be written into your tenancy agreement (for advice on your tenancy agreements, read the Citizens’ Advice Bureau’s guide). If you really don’t want it, and would rather simply rely on your deposit, then your best option may be to look for an agent/landlord who doesn’t require it. If that search doesn’t seem to go anywhere, then your best bet may be to shop around insurance providers until you find something at a price which suits you. Remember, an agent can never force you to buy insurance from a certain provider.
Worried about other things the agent might be telling you? The government has made a great guide called how to rent which should cover most of the bases if you’re ever in doubt about what is normal to expect when you rent.
How do providers differ?
Lots of Home Contents Insurance includes Tenant’s Liability insurance as standard, but not all, so it’s worth checking the policy wording of your provider. There are hundreds of providers of home contents cover, so we won’t go into them all here.
Most of the providers of standalone Tenant’s Liability Insurance are specialists, so there are no real household names, but each of the providers listed below are regulated by the FCA, so as long as you are careful to read the product information and terms on their site, you can buy with confidence.
The cover they offer mostly differs on:
Other things to look out for are:
What does it typically cost?
In case you didn’t realise, we love a bit of data. Here’s something we made earlier comparing price and coverage for standalone tenants’ liability insurance. As you can see, prices tend to fluctuate between £40-£100.
* IPT stands for Insurance Premium Tax, which is currently charged at 12% on all insurance products
How can you reduce your risk?
Whether you’re taking out insurance or not, you should take care of the property and its contents (both your landlord’s and your own), so it’s sensible to agree on some ground rules with your flatmates. These could range from cleaning rotas to ward off things like mould and damp, to rules surrounding parties (how big a party you can throw, if your flatmate’s dodgy boyfriend can bring his friends, etc.)
Basic things like cleaning your oven regularly and making sure you don’t put anything you shouldn’t in the washing machine could make your life a lot easier down the line. Similarly, be careful when it comes to hanging things up on the walls, as you could pierce a water-pipe and end up flooding the room. You could even go so far as to ask the landlord or letting agent to take any really valuable items away if you’re worried about damaging them. If you want a more in-depth guide, we wrote a blog about ways to keep your deposit, which may be helpful..
I’m a landlord, should I be thinking about tenants’ liability insurance?
If you’re a landlord and you’re unsure as to whether or not you should be asking your tenants to get liability insurance, then we may be able to help you out. If you’re worried about your tenants damaging your things beyond the value of the deposit then it’s definitely worth considering it. However, many tenants’ liability insurance packages are more expensive than they strictly need to be, and renters can be put off – especially in places like London where deposits can be many months’ rent. As a landlord, be wary of agents which will demand your tenants get liability cover from particular insurance providers, as this could lead to decreased interest in your property and won’t be much help to you in the long-term. How relevant tenants’ liability insurance is will rely largely on the tenants you have, so that’s worth bearing in mind, too.
Got any questions?
We know insurance can be a bit confusing, and we love talking about it, so if you have any questions, please get in touch by hitting the Contact Us button on our home page.
Or alternatively you get tenants’ liability included with our contents insurance, which you can get a quote for here.
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Urban Jungle is a home insurance business, specialising in renters and sharers. We’re using technology to make insurance better for young people, but also care about helping people make life as renter better.
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