12th November 2020

Landlords Are Protecting Their Rental Income With This Simple Step

Category: Lettings


Tags: insurance, LANDLORDS, rent protection

Leo Der-Galestanian

Lettings Manager, Kingston upon Thames

Leo Der-Galestanian

Please click one of the buttons below to read more about what is available to help you as a landlord or tenant.

PROTECTION FOR LANDLORDS PROTECTION FOR TENANTS

 

What are the new Government protections for tenants?

The Housing Secretary, Robert Jenrick MP, announced on 5th November 2020 that additional protections had been put in place to protect tenants which means:

  • Evictions will not be enforced whilst national restrictions are in place.
  • Evictions will not be enforced by bailiffs until 11 January 2021 at the earliest, except for the most serious cases such as anti-social behaviour.
  • Six month notice periods remain in place until at least the end of March 2021, except for the most serious cases.

 

This is obviously welcome news for the thousands of people who rent and who may be struggling financially, through no fault of their own, due to the Covid-19 pandemic.

Whilst national restrictions are in force, the only circumstances where these protections do not apply are illegal occupation, fraud, anti-social behaviour, eviction of domestic abuse perpetrators in social housing; where a property is unoccupied following the death of a tenant. The Government is also set to introduce an exemption for extreme pre Covid-19 rent arrears.

How can landlords protect their rental income?

It’s fantastic news that the Government are taking steps to ensure tenants are not being forced from their homes as a direct result of the pandemic, but landlords also rely on tenants paying their rent not only to cover their mortgage, but also in many cases as a form of income.

Whist we take every possible precaution by obtaining references and checks on tenants before they move in, the biggest risks a landlord faces financially are:

  • Lost income due to non-payment of rent.
  • Costly evictions of a tenant from their rental property.

 

Despite the stringent procedures we have in place, exposure to these risks have increased in recent months as more people find themselves in financial difficulties due to the Covid-19 pandemic. Now, more than ever, as a landlord it is crucial to ensure your rental income is protected.

Most landlords are unaware that it’s possible to insure against lost income and legal costs when a tenant can no longer pay their rent.

While you take every precaution to rent to only reliable tenants, their circumstances can sometimes change outside their control. When this happens, it’s natural to be sympathetic, but also important to ensure you still receive the rental income to cover your mortgage or outgoings.

The Benefits Of Rent & Legal Protection (Rent Recovery Plus)

Insurance cost to cover the rental value of a property is small in comparison to the potential risk of a tenant not paying rent, especially as our rent and legal protection service called Rent Recovery Plus is one of the most comprehensive policies you can get and covers many types of situations/breach of contract.

Key features and benefits of Rent Recovery Plus:

  • Cover for the total monthly rent, no matter how many tenants are on the tenancy agreement.
  • 100% of the monthly rent paid for up to a maximum of six months from the date of the first arrears.
  • Legal expenses up to £50,000 for an eviction.
  • Covers breaches of the tenancy agreement by the tenant, including non-payment of rent and expired section 21 notices.
  • 50% of the rent paid for up to two months after vacant possession has been obtained, whilst new tenants are found.
  • Six or twelve month cover to suit the tenancy.
  • Rent Recovery Plus (RRP) covers the whole property meaning the policy continues even when/if the tenants change.
  • Excess or nil excess options available.

 

We can also provide information on a range of Landlord Insurance products, including:

  • Landlord’s Building Insurance
  • Landlord’s Contents Insurance
  • Landlord’s Contents Insurance for unfurnished properties
  • Home Emergency Assistance and Boiler Cover

 

Frequently Asked Questions on Rent & Legal Protection

What tenancies are most at risk of lost income?

You may be forgiven for thinking that tenants falling behind with their rent is more likely for those with lower incomes, but this is not the case and even more so with Covid-19.

Every let has a slim but potential risk to the landlord, so taking out the correct rent and legal protection significantly reduces the risk to the landlord should their tenant’s financial situation change.

What happens when a claim needs to be made?

In the unfortunate circumstances that a claim has to be made, we will raise the paperwork, produce rental statements and submit the claim on behalf of a landlord.

If need be, under our Fully Managed Service, one of our experienced team members will attend eviction processes and court attendance at no further cost to the landlord. Details of the services we offer for landlords and what each service includes can be found below.

The references we obtain on all our tenants are also directly linked with the insurance policy, so if a tenant cannot pass our referencing criteria we will not have the option to take out rental insurance on behalf of the landlord. In the current climate rent protected is limited to £2,500 pcm, but we are hopeful that this will change once the Covid-19 pandemic is under greater control.

Can you take out rent protection on a current tenancy after it has started?

Yes. Rent and legal protection can be taken out after a tenancy has commenced, provided there are no issues which may result in a claim and the tenants have been professionally referenced. There will usually be a one month void period in these scenarios. However, this is still worth considering provided there have been no historic problems with the tenant.

All of our branches have a dedicated lettings division and will be fully operational throughout this second lockdown and available should you be thinking of letting out your home or are looking for a property to rent. So, for full terms and conditions of our Rent Recovery Plus service or if you have any questions or concerns please don’t hesitate to pick up the phone and contact your local Curchods branch.

 


Thinking of letting your property?

If you have been considering letting your property or would like to know more about our Rent Recovery Plus service, please book an appointment with your local Curchods branch.

BOOK APPOINTMENT

 

 

 

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We are members of ARLA Propertymark, the UK’s foremost professional body for letting agents which means we are required to operate in a transparent way, providing services which are subject to independent scrutiny, giving you peace of mind at all times.

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