What is unoccupied versus let property insurance?

This is a question that sometimes causes a little confusion when discussing let property insurance.

Classic let property insurance

Although it sometimes may catch some people a little by surprise, once you let out a property (including your own home or even a part of it) then typically:

• you have just made the transition to becoming a landlord;

• any existing owner-occupier buildings and contents insurance you have will typically become invalid and;

• you may require let property insurance to maintain cover for your property and contents.

The cover provided may vary between insurers but typically a policy contains protection for the building’s structure, it’s contents and third party liability (note that this is not the same thing as employers’ liability).

Some policies may offer additional benefits such as elements of legal cover and perhaps malicious damage caused by your tenants.

Although this may appear to be a good comprehensive list, in fact if your property becomes unoccupied for a period, your cover may terminate.

Unoccupied property and insurance

If your property stands unoccupied (meaning not that it is empty of contents, simply that nobody is residing there) for a period of greater than 30 consecutive days, your existing landlord insurance cover may cease.

The reasons for that are simply because an occupied property may be at higher risk of certain categories of problem, such as burglary, than one that is occupied.

As such, to continue cover in such situations, you may be advised to seek an unoccupied property insurance quote.

It’s worth remembering that the reasons for your property standing unoccupied typically won’t matter to an insurer and it may be classed as such even if the circumstances were entirely beyond your control, such as:

• building work that overruns;

• new tenants let you down at the last moment and fail to arrive;

• you have kept your property unoccupied while overseas on business and your trip unexpectedly overruns;

• you have a property you can’t do much with until probate issues are resolved;

• you are in a similar situation pending a divorce settlement etc.

All things considered, it may be advisable not to take the chance and to find out more about unoccupied cover.

Landlord insurance myths

In the case of both forms of landlord cover, some people may be inclined to wonder if they could get by without let property or unoccupied property cover – depending upon the situation.

In reality, this may prove to be a grave error.

Following a claim, insurers typically check the occupancy status through various sources and if you have a made a false claim in the absence of let property insurance, you may find it difficult to obtain cover in future and leave yourself liable to prosecution.