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The Ultimate Guide to Landlord Insurance Cover

While renting out additional properties (or even sub-letting) is becoming more common, home owners still frequently ask "what is landlord insurance?" and "how much is landlord insurance?" Discover what it is, what it covers, why you need it and get advice on various cover options and tenant types.

What is landlord insurance?

Landlords insurance is designed for the protection of property owners who are renting to tenants. A tenant is a person or group who has a rental agreement in place allowing them to inhabit the property. The tenancy agreement will set out your responsibilities as a landlord and often will specify the requirements for you to have the correct insurance in place.

But exactly what is landlord insurance cover and its purpose? Landlord insurance protects you as the property owner from financial losses connected to the rental, such as theft, fire, or weather damage and can be extended to include coverage for things like unpaid rent and malicious damage by tenants. In some cases, landlord liability insurance may be needed to protect you against third party claims. For more information on insurance for rental homes, see our article on common features of landlord insurance.

Do I need landlord insurance?

While you are not under legal obligation to obtain landlord insurance, your mortgage lender may require that you do so. Equally, your tenancy agreement may require certain responsibilities of you that are best served by a rental home insurance agreement, especially if you want to avoid putting your financial future at risk.

What is the difference between landlord insurance and standard home insurance?

You may not feel or operate like a business, but by earning money through rent, you are for insurance purposes classified as one. While buildings insurance is standard with both insurance types, home insurance is not always suitable for a property which is let out, nor is it designed for the needs of a landlord. There will be gaps cover and won’t cover you adequately for the liability, legal and loss of rent options available on a landlord’s policy. Furthermore, renting and not telling your home insurer could invalidate your home insurance. To protect your earnings and your material assets, it’s sensible to choose a landlord insurance policy as soon as you start renting out your property.

Different types of tenant

Professional let

A working person, couple or family who earn a living and pay their rent themselves.

Department of Social Security (DSS) tenants

DSS means Department of Social Security and refers to tenants who receive financial housing benefits from the council.

Not all insurers cover buildings occupied by DSS tenants, although it’s not difficult to find through any good specialist insurer. If you opt to rent to DSS you will see an increase in your premium, but many landlords choose this option because of the increase in potential tenants.


Similar to DSS, student lets also demand a higher premium for many insurers but your potential yield can be higher, just make sure your insurer is aware it’s students you let to.

Family members

It’s very common for landlords to let to a family member. For insurance purposes, you should have a tenancy agreement in place, even if in real life you operate less formally.


Insurers generally don’t allow sub-letting. This is because of a potential lack of control and awareness of the exact occupancy leading to potential problems in the event of a claim. The tenants are not under an agreement directly with the landlord and may not have been vetted.

What does landlord insurance cover?

Landlord insurance typically covers as standard:

  • Property owners’ liability cover
  • Buildings insurance
  • Loss of rent cover
  • Contents insurance

Optional covers include:

  • Accidental damage cover
  • Legal cover
  • Emergency assistance cover

Loss of rent: indemnity period

Should the property become uninhabitable as a result of damage by an insured peril, the indemnity period is the maximum length of time ‘loss of rent’ can be claimed for after a loss.

How long should my indemnity period be?

12 months is the standard minimum on most policies. However, longer periods should be considered, taking account of the time taken to rebuild the property. Factors to consider are location, specialist design, construction period and for older properties if it’s a graded historical building. Don’t underestimate the time it takes for demolition and debris clearance, architects, planning and then rebuilding. As you can imagine, unforeseen delays can and do occur. Also check in your Tenancy Agreement as that may also specify a longer period, perhaps 24 or 36 months or even longer.

What is landlord contents insurance?

Landlords contents within common parts of a building is often included as part of a landlord insurance package. However, where properties are let on a furnished basis, cover is not automatically included and you should mention this to your insurance adviser so that cover can be tailored for you.

This type of insurance is intended to cover loss or damage caused to landlords contents by a range of insurance perils such as fire, water damage and theft, affecting any items belonging to the landlord within the premises.

Some policies can include accidental damage, but note that not all will cover accidental loss or damage caused by tenants. It is important for you to identify the cover you need.

What does landlord contents insurance cover?

A great way to understand the difference between your ‘contents’ and your ‘building’ would be to (hypothetically) tip your house the wrong way up. Anything that would fall is considered contents. This would mean furniture and decorations are covered by landlords contents insurance, but the walls, ceiling, sanitary ware and fitted kitchen / bedroom cabinets come under buildings insurance.

When renting a furnished property this becomes important and many policies offer a standard coverage. Make sure you know what this level is and decide if you need to increase the amount to reflect replacement as new prices.

Are my tenants responsible for their own contents insurance?

Yes, they are. You are not responsible for accidental damage to your tenant’s belongings. You can advise them to acquire their own tenant’s contents or student contents insurance policy.

Do I need landlords contents insurance?

If you are a landlord renting out a completely empty property - with no furnishings at all - then landlords contents insurance may not be necessary for you. However, if you are offering a furnished or part-furnished property, then landlords contents insurance is crucial to cover your contents.

The cost of a few pieces of furniture, curtains and kitchen appliances can quickly add up - especially if they are all lost or damaged in one go due to a fire or flood. Therefore, even if you have just a few items, it is worth investigating landlords contents insurance and ensure these are valued on a replacement as new basis.

Don’t forget, if the item is attached to the fabric of the building, it’s likely to be insured already under your building insurance (other than carpets). That means toilets, sanitaryware, bathrooms and kitchen cabinets may already be insured. If you’re at all unsure simply ask your adviser as there can be exceptions to these rules.

Things to consider when selecting a landlords contents policy

Be careful not to underinsure yourself as you may lose out by not receiving the full amount you expect to be paid in the event of a claim. Ensure you walk around the entire property to accurately calculate the total new replacement values of all contents room by room within the building. Should the worst happen and you need to claim for everything, you will need to be insured for the full amount otherwise you could lose out.

Your insurer will be able to add or adjust landlords contents values at any time during your policy life. Therefore you should only pay for the cover you need.

Landlords contents insurance exclusions

Tenants' contents are not your responsibility. Landlord contents insurance will only cover property and contents which belong to you. Any items the tenant brings with them will need to be covered by their own contents insurance. 

Towergate can arrange cost-effective policies for tenants and students requiring contents insurance, from our panel of specialist insurers.

Property owners’ liability cover

This is often the most misunderstood or overlooked by new landlords. Liability insurance for landlords is a type of public liability insurance that compensates loss, damage or injury to a third party and their property. The landlord is ultimately liable because it’s their responsibility to oversee that their property is adequately maintained and in a safe condition.

For example: A third party (e.g. a postman) trips on a loose slab in your drive way. Here, you could be held liable for damages and compensation. In this case, landlord liability insurance or property owners' liability insurance would protect you in the event of a claim.

How much should my property owners' liability (POL) be?

Limits usually are offered at £1m, £2m or £5m. It's difficult to foresee the potential size of a claim, but consideration should take into account the number of individual occupants within the property, as this impacts the potential aggregation of personal injury claims in the event of a serious accident. In general terms the higher limits of indemnity should be considered.

Buildings insurance

You must insure your property for the rebuilding cost at today’s prices; this is one of the most important factors in protecting your property and vital you get it right. It exists to cover the costs for repairing damage right through to rebuilding - should it be needed. Imagine a fire sweeps the building out or a severe storm hits, leaving the property utterly inhabitable.

You should insure yourself for the full re-build cost of your property. Being under insured (meaning you state to your policy provider that the cost to rebuild your house is less than it actually is) will leave you vulnerable to paying the difference– as per the condition of average clause looked at below. Trying to save a few pounds on your insurance could effectively make it not worth while having in the first place.

Tip: There are various free re-build calculators online that can easily assist you in working out your re-build cost, such as the BCIS Public Rebuild Calculator.

Subsidence insurance

If your property has suffered from subsidence – the downward movement of the structure or the ground supporting it - you will need to declare this during a quotation. It is vital that you do so, or you risk further complications caused by subsidence remaining uninsured.

You will need to provide proof that the issue has been checked by a professional and although it will most likely raise your premium, a specialist insurer should not have a problem sourcing you a policy that provides adequate cover based on a case-by-case consideration.

Optional cover for landlords insurance

Accidental damage cover

Accidental damage insurance is there to cover you for damage and the cost of repair or replacement to your property or contents when caused by you, your tenants, or a guest.

This is not always offered as standard, so be sure to make clear during your quote that you want accidental damage coverage included. 

If you already have a landlords policy, check your policy wording to see if the cover is in place as standard or you need to add it in.


What does accidental damage insurance cover?

Accidental damage is considered damage to the property not classed under another insurable peril. An claim could be for something as simple as a red wine spill, to more serious incidents such as:

  • Foot through the loft
  • Nail through a pipe

This is specifically to cover accidental damage caused by you. Accidental damage when caused by your tenant is usually covered by their deposit or even potentially their own insurance (see the 'tenant damage cover' section).

What is excluded from accidental damage insurance?

  • Wear and tear: The general maintenance and upkeep of a property is still the owner’s responsibility.
  • Third party work: Damage caused by faulty workmanship will be covered by the workman’s own liability insurance and therefore, you don’t need to pay for coverage of their work.
  • Malicious damage by your tenants: Although this is insurable, it is usually offered as an optional cover.

Legal cover

This is help with legal fees when taking someone to court for non-payment or equally when defending someone taking the landlord to court. Legal cover is not usually found as a standard policy feature but can be requested as an optional add-on to your policy. As a landlord you will have specialist requirements and you should speak to an advisor to discuss the costs and level of coverage you might be interested in.

Tenant damage cover

Tenants are considered to be on your property with your permission, which is why this type of cover is not a standard requirement. If an incident arose where tenants were to accidentally damage or intentionally cause malicious damage beyond the value of their deposit, this option would keep you covered for the costs.

If an incident arose where tenants were to intentionally cause malicious damage beyond the value of their deposit, this option will keep you covered for the costs.

Emergency assistance cover

Emergency assistance cover for landlords is an extra level of cover that some insurers provide as an additional cover on landlord insurance. Typically policies include a combination of the following elements:

Boiler cover

A boiler break down can be a great cause of frustration and even cause health risks for tenants, especially in winter. Making sure you have your boiler covered with a quick incident response time means you can rest easy should something go wrong. The sudden failure or breakdown of your boiler is not included as standard on a landlord insurance policies. Usually you would arrange supplementary cover through a third party like British Gas.

Plumbing and drainage cover

Sudden damage to the home’s plumbing and drainage system caused by breakage or blockage and flooding. Drainage issues often arise in the autumn, as levels of rain increase and fallen leaves block up the gutters. If left untreated, water damages produced by plumbing and drainage issues can result in other issues such as mould.

Home security cover

If its windows or doors become damaged the house becomes insecure, which could result in theft or environmental damage to your property. Making sure that a broken door or window is replaced swiftly mitigates that risk, helping your tenants to sleep soundly.

Power cover

Should there be problems with domestic power outage, leaving your tenants literally in the dark, this element of your emergency cover will get an electrician sent out within 24 hours, making the sure the problem is solved swiftly.

Lost keys cover

If the only set of keys to the home are lost or stolen, preventing access, then lost key coverage can save the day by providing access to the property. These things happen!

Vermin cover

Sometimes the critters try to get the best of us. With vermin cover, you can make sure an infestation is dealt with swiftly and professionally, protecting your property and the wellbeing of your tenants. This covers mice, rats, wasps and hornets. This is generally excluded from standard landlord insurance policies.

Roof cover

Another risk, especially during the blusterier seasons, is damage to the roof of your property. If something does happen which has or is likely to cause internal damage than the roofing feature of emergency assistance will have you covered.

To learn more about emergency assistance and other optional landlord insurance covers, request the policy documents and discuss with an advisor to find the right cover for you.

What insurance do you need as a landlord?

Landlord insurance for unoccupied property

Unoccupied properties are much more susceptible to break-ins, petty crime, squatting etc. As such, insurers generally exclude unoccupied properties from their policies as standard. If the property becomes temporarily unoccupied during a changeover of tenants or a renovation, many policies will maintain full cover for a certain amount of time, usually around 30 days. After this time period some of the cover will automatically be restricted and you’ll be asked to switch off mains services, drain water /heating systems and make regular recorded inspections.

You should always inform your insurers of any unoccupancy and check your policy to fully understand how your cover is affected. In some instances of long term unoccupancy specialist unoccupied property insurance may need to be arranged.

Understand limitations of accidental damage

It is always advised you make yourself aware of the accidental damage exclusions of any policy you consider. Typically these will exclude claims that are ‘inevitable’ such as wear, tear and deterioration.. Discussing these and other exclusions will help you understand your side of the insurance agreement, such as expected levels of maintenance (plumbing, tree surgery), and what in turn you can expect your insurer to cover.

Landlord insurance for multiple properties

You will often be able to get a discount for insuring multiple properties on one portfolio. Premiums can get lower with some insurers and large discounts on admin fees. You can add newly purchased properties pro rata to existing policies allowing the policies on all properties to finish and renew at the same time. You'll need to speak with a specialist insurance provider but they'll often be able to find you a great deal by comparing quotes from a number of insurers.

Money back

As with many commercial policies, you may not have a cooling off period affording free cancellation once your policy has been purchased. Check this during the quotation to make sure you are fully aware of what your options are.

Further tips for landlords

Renting to DSS tenants

If you choose to rent to DSS tenants, it’s worth taking some precautionary steps to avoid any issues around rent payment. Here’s a few tips:

  1. Ask how they will pay you rent –, cash, credit, direct debit.
  2. Ask how much of their rent is covered by the financial support they receive, and what’s the shortfall?
  3. Ask how they intend to cover the shortfall.
  4. Consider and discuss whether weekly rent payments, rather than monthly, is more suitable.
  5. As with all prospective tenants, make sure you check their rental history.
  6. Declare the tenant to the local council, so council tax bills are made out to them.

Tenant referencing

Landlords are wise to properly vet their tenants to confirm their financial status and references. It makes good business sense to know who you are signing agreements with. This is a quick and relatively in-expensive service that can even be done online. We have a partner service we recommend here. Alternatively, some independent landlords prefer to do this themselves.

Subletting and landlord insurance

With the rise of the sharing economy in the shape of companies like Airbnb, subletting has become ever more popular. It’s important to speak to your tenants about subletting from the start of their tenancy so they understand the impact it may have – both on your landlord insurance and on your mortgage. Speak to an advisor if you want to discuss your options when it comes to extending your landlord insurance to cover subletting.

Landlord insurance from Towergate

We provide landlord and rental home insurance for a wide range of properties and tenants including multi occupancy, students, local authority placements, unoccupied and much more. See our landlord insurance page or call 0344 346 0409 for more.

About the author

Mike Stephens is a respected senior industry professional and Fellow of the Chartered Insurance Institute (CII) with well over 40 years’ varied experience in the commercial insurance sector as a director, underwriter, and operational improvement manager.

This is a marketing article by Towergate Insurance.

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