Do I Need Public Liability for My Buy-to-Let Property?
In this blog, we will talk about if you need Public Liability insurance for your Buy to Let scheme. Many people, especially first-time buyers, find that the buy-to-let process can be stressful if you are not familiar with the process. So we hope that this blog can help you find some answers and get you one step closer to closing that BTL deal!
The short answer is no; as a landlord, you are not legally required to take out public liability insurance.
But there’s also a longer answer, and as you can probably guess, it suggests that yes, you should almost certainly take out public liability insurance for your buy-to-let. Let’s get into it!
What is Public Liability Insurance?
Public liability insurance for landlords pays the bill if someone makes a claim against you for injury or damage to their possessions while at your rented home. It covers the solicitor’s fees, the other party’s legal fees, and any compensation awarded.
There is legislation in place that says landlords must make sure their rental properties are fit for tenants to live in, and that they must take reasonable steps to protect tenants and visitors from harm from any defects. Though public liability insurance isn’t compulsory, it offers peace of mind to landlords that they are protected financially as per these legislations.
Why Do I Need Public Liability Insurance?
As a landlord, you have a duty of care to anyone living at or visiting your property. There are a number of potential dangers in a rented home, and they could be as innocuous as a loose piece of carpet or floorboard. If someone trips, there’s every chance they will pursue a compensation claim; you could be held liable for loss of earnings, medical costs, and various other expenses. Without public liability insurance, you may end up having to pay out thousands of pounds.
In recent years we’ve seen a rise in personal injury claims being made by tenants. This is likely due to the increasingly present advertisements of lawyers offering to pursue a no-win-no-fee claim. The reality now is that no matter how careful you are, there’s always a chance that a claim will come your way. But as long as you have public liability insurance, you’ll be prepared and covered.
It’s also worth noting that public liability insurance includes damage to someone else’s possessions if they are damaged or destroyed because of a fault at the rental property, e.g. a TV damaged by a leaking pipe. Stuff like this can happen without warning, and without insurance, you would have to foot the bill of replacements yourself, so it really is best to be covered.
How Much is Public Liability Cover?
The good news is that public liability is one of the cheapest insurances for landlords. You can expect to pay between £40 and £60 for the policy - and keep in mind that most landlord insurance packages will include public liability as standard.
What Public Liability Should I Get for My BTL?
The cover levels of public liability are usually £1 million, £2 million, £5 million or £10 million. If you are renting out a single property £1 million is usually enough. If you let several properties, you will likely want to pick a higher limit. Remember that buying a portfolio policy is often cheaper than buying several stand-alone policies.
As with any insurance, shop around for the best quotes, and don’t just automatically go with the cheapest: choose the one that best suits your needs.