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Property Insurance

Tuesday, 31st May, 2016

Getting the right insurance for your property or your portfolio is just as important as getting the right tenants. In fact, there are a number of things you need to be aware of when taking out insurance to make sure it is right for you. We have put together some useful tips to help you protect your property investment.

Rebuilding Sum

Make sure you know the correct rebuilding sum of your property. In our experience, many customers only filling in an online form can get this wrong. Rather than the value of your property, as many believe, the rebuilding value is actually the amount of money it would take to rebuild your property - including architects' and builders' fees. It is also often referred to as "sum insured". A qualified surveyor will be able to calculate your rebuild value or, alternatively, for an estimate you can go to http://calculator.bcis.co.uk.


Getting your sum insured right is an important step towards avoiding being underinsured. When you are looking to take out insurance, you need to make sure that you know the sum insured of your property as well as the value of any contents you wish to insure. If you underinsure your property or contents, you run the risk that, in the event of a claim, the insurance will only pay out a portion of the actual value of the property. In other words, if you underinsure your property by 50%, you risk only getting 50% of the insured value back should you have to make a claim.

Making Sure You Know What's Covered

Always read your policy wording carefully. While it may not seem worth it so some to invest the time to read the documents in full, it is important to know what is covered within the insurance policy you have taken out. Some areas which you may assume are already included may not be. There might be an excess listed for a claim, which means you have to pay a certain amount yourself. It is also vital that you know what is expected of you as a policy holder, i.e. what you need to tell you insurer along the way.


One of the things you need to inform your insurer about is whether or not the property is unoccupied. Most insurers will cover the property for up to 30 days  whilst it is vacant. However, you may have to abide by certain rules listed in your Terms & Conditions, like weekly checks on the property. If you do not tell your insurer that the property is empty, you risk having your claim dismissed should you have to make one, e.g. because of burglary, a burst pipe etc.

How to Make a Claim

If the worst case scenario happens and you have to make a claim, you should inform your insurer as soon as possible. Urgent repairs can be made immediately, but photographic evidence of the damage should be taken. Seeing your property damaged can be a very stressful experience and it is important to have the right insurance by your side to support you through the process.

The Deposit

To make sure you cover yourself towards any damage caused by your tenants, it is advisable to get the tenant to sign a photographic inventory at the beginning of a tenancy. This then enables you as a landlord to check any contents against their original state at the end of the tenancy. Ensure you use a tenant deposit protection scheme to keep your tenant's deposit safe for the duration of the tenancy. Should you need to make a claim because of any damage or negligence on behalf of the tenant, you can arrange to recover your costs from the deposit.

Keeping Records of Communication

Proving what has been agreed with a tenant at any point during the tenancy is also a vital step towards protecting your property from damage. It is good practice to keep a record of any communications between yourself and your tenant. If you had a verbal conversation, you can follow up with an email summarising what you discussed. This way you will be able to prove what you agreed with the tenant, especially if any damage occurs, should they fail to inform you of any important developments.

Cheap Isn't Always Best

As with many things in life, cheap isn't always the best deal. Make sure you cover all the points above to ensure you insurance really does what it says on the tin. Good customer service can also be helpful, especially if you ever do need to make a claim and need someone to support you through that difficult time. In the end, your property is an investment and as such deserves the best care it can get, including insurance.


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