Is Rent Guarantee Insurance Really Worth It?

As a landlord there is always a risk that a tenant may default on their rent. Even with the best checks and references carried out, you can never predict a tenant falling on hard times, losing their job or becoming ill and not being able to pay the rent. But is rent guarantee insurance really worth it, or just another expense?

What is it?

Rent guarantee insurance is also known as rent protection or landlord rent insurance.

It protects landlords against loss of rental income if a tenant is unable to pay.

Where a tenant continually defaults, the eviction process can take a long time, meaning you’re without rental income until you can resolve the situation. Rent protection insurance covers losses for up to 12 months; it also includes legal expenses which you may incur during the eviction process.

How much does it cost?

The cost is £280 for a 12-month policy. If you wanted to take this up, you would just need to let me know prior to the tenancy commencing. Rent guarantee insurance is tax deductible. For this you will get:

• Rental income protection (up to £2500 per month)
• Zero Excess
• Legal expenses cover (up to £100,000)
• Section notices issued
• Chasing of rent arrears
• No covid-19 restrictions
• Mediation service

Why is it a good idea?

Many landlords need their monthly rent to cover mortgage payments, so not having cover could prove a big risk in the long run.

You might already have rent guarantee with your home insurance policy. Make sure you speak to your provider to check.