However, whether these portfolios are owned by limited companies or by individuals, we still see many brokers arranging separate general insurance policies on each property when a single block policy may well serve the customer better.
A portfolio landlord’s block policy offers protection for all properties within its scope, and they can cover both standard and more complex non-standard risks under one policy.
They are invariably cheaper than separate policies and much easier to manage. One policy, one payment, one renewal, and one place to go to make a claim – a time saver that I am sure these very important clients will thank you for.
What does a landlords’ block policy typically cover?
Property damage: The policy will cover each property against damage to the buildings, and (when needed) landlords’ contents, whether it be for communal areas or any furnished accommodation.
All policies should cover the main perils, such as fire, escape of water, flood, explosion, earthquake, impact by vehicles, etc. Others, such as accidental damage, subsidence, landslip & heave, or malicious damage by tenants is not always automatically covered, so check cover is in place if required by the customer.
Liability: Every landlord has a legal liability to the public, including their tenants, and should have Property Owners Public Liability cover included. Any limited company landlords must have Employers Liability, and all landlords may also need Employers Liability if they directly employ staff to help with building management or maintenance, for example.
Loss of rent: If one of the properties were to become uninhabitable due to fire, flood or another insured peril, it could take time to complete the repairs. Whether the property is a residential or commercial unit, the rent received from the tenant(s) or occupier could also cease due to the incident. Choose a policy that includes loss of rent for these circumstances, with a tailored indemnity period of up to three years from the date when the loss occurred.
Some policies can also cover the costs of alternative accommodation for residential tenants while the property is uninhabitable following an insured damage claim, allowing the tenant to continue to pay their rent and be re-housed for the duration of the tenancy agreement.
Whether it is an extension to the main property insurance, or purchased as a standalone policy, there are a host of additional covers a landlord may choose. These include, but are not limited to:
Legal expenses: to cover the costs of any legal disputes around the ownership or letting of the property, including any tenancy disputes;
Rental protection: while all good policies provide loss of rent in the event of a claim on the buildings section, insurance can also be arranged to cover loss of rent due to a default by the tenant;
Engineering inspection: if the property has plant or machinery, such as a lift, it may require annual inspection. A policy can be arranged to cover these statutory obligations;
Engineering material damage: specialist cover may need to be arranged depending on the nature of the plant or machinery which may be excluded from the main policy;
Directors and officers, or management liability insurance: providing cover for the landlord against their statutory obligations, including health and safety breaches;
Claims assistance: while every insurer should provide a fair claims service, on the larger claims, there can be significant impact to the client during the claims process. A claims assistance policy provides the client with their own loss adjuster to help in the claims process, but also to ensure the insurer is treating them fairly.