BELIEVE IT OR NOT WHEN YOU RENT A PROPERTY?
93% of tenants do not have a content insurance policy to protect their personal belongings or insure against accidental damage the property they rent from a landlord.
The average deposit taken at the start of a tenancy represents just 20% of the value of the landlord’s property rented to a tenant. This leaves 80% of the landlord’s property not covered by a deposit in the event of accidental damage by a tenant.
Household claims are on the rise, an average of 6.9 million accidental household insurance claims are processed every year.
With rising rents and static incomes just 62% of tenants just marginally show rent affordability when being referenced for a new home, therefore, the majority of tenants entering a new tenancy agreement would not be able to afford to pay for repairs or the replacements of fixture & fittings in the event of an accident in their rental home.
28% of all deposits that are disputed at the end of a tenancy with the Deposit Protection Schemes are for property related damage caused by accidental damage. A recent survey showed that to recoup their losses a large percentage of tenants who lose their deposit from accidental damage fail to pay the last month’s or in some cases two months rent because they offset it as the deposit for their next property.
Priority probability spending analysis: statistically, if a tenant is uninsured at home and accidentally breaks an essential item (TV etc) or has their belongings stolen they will use the money they have to replace or repair the item before they meet other essential payments (expect a mobile phone contract) in full.
Landlords report an increase in part payments of rent being made as tenants are using a proportion part of the rent as an interest free banking service to repair or place items in the event of loss or accident. Tenants were then offering landlords stage payments (without interest on the money owed) to make up their arrears.
LANDLORD & AGENTS ASK THE QUESTION?
Landlord & Agent Q: Can a tenant insure their belongings and the belongings they rent against accidental damage?
Rent Safe UK A: Yes, a tenant can insure both the landlord’s fixtures and fittings that they rent and their own personal belongings.
Landlord & Agent Q: Can a landlord insure their legal costs against taking a tenant to court for malicious damage to my property?
Rent Safe UK A: Yes, you can insure against all your legal costs and a solicitor will be nominated to you without charge to recover all your legal costs and property damage costs against a tenant.
Landlord & Agent Q: Can a landlord or agent insist on a tenant having content insurance to protect the property they rent and their property and belongings in the event of an accident before I offer them the property?
Rent Safe UK A: Yes, the terms and conditions that you set out for a tenancy at the application for a tenant is your prerogative, either the tenant can agree with the conditions of tenure or not take the property. At the application point, landlords and agents should make it clear that in order to protect their belongings, their deposit and the property they rent from you in the event of an accident they should have a contents insurance in place when they move in.
Landlord & Agent Q: Can I get Tenant Referencing UK to check a tenant has a content policy alongside the employers and previous landlords reference as part of my serviced reference?
Rent Safe UK A: YES, as part of the serviced referencing application landlords and letting agents can request that we check a current policy or offer a tenant a free quote to give them the policy to comply with the terms and conditions of referencing by a landlord or letting agent.
Landlord & Agent Q: I don’t want to put off good tenants off by insisting on them having insurance so, is the tenant content insurance expensive?
Rent Safe UK A: No, tenant content insurance starts from as little as £86 a year and with an initial payment of around £30 we can even stagger the repayments over 10 months to help a tenant’s cash flow. However, with the average tenant losing a minimum of £550 deposit and with a landlord losing an average of £818 this is a small price to pay for security for both landlord and tenant in a future tenancy agreement.