Rent Guarantee Insurance For Landlord

The household goods and personal belongings represent many years of financial and emotional investment. Therefore, you need to ensure that your house or property and its contents are insured against fire, theft, damage etc. “Rent guarantee insurance” is a form of insurance where, for a relatively small annual fee, landlords can protect against loss of rent. Rent guarantee insurance is designed to protect you in the event your tenant fails to pay the rent. This rent guarantee insurance policy will also cover landlord’s legal costs to pursue legal cases for damages or injunctions against tenants who breach the terms and conditions of their tenancy agreement. Rent guarantee insurance can help you and keep protected against all kinds of risks that you may be prone to against tenants.

Rent Guarantee Insurance

Rent guarantee insurance is designed to protect you in the event your tenant fails to pay the rent. Rent guarantee insurance becomes a vital necessity for all those landlords who are not staying at the place wherein their house has been rented out. Rent Guarantee insurance is not a new term or a new concept, this scheme is available all over the world but insurance companies use different terms such as Rent Guarantee Insurance, Landlords insurance, Landlord’s rental property insurance etc.

It’s better to have a rent guarantee insurance in order to avoid paying your tenant the compensation directly from your pocket for roof blow off, pipes burst, things break down hurting the tenant or damaging his assets. Rent Guarantee Insurance covers rental building, personal property, such as tools, appliances, furniture, stored on-site or provided by you for use by your tenants. Such rent guarantee insurance helps you in times of some calamity, loss of rental income and legal expenses incurred to fight the tenant. This insurance does not include water damage of fixtures or other fittings, in case there’s a pipe burst out.

Claim rent guarantee insurance

There are certain requirements to make a claim on your rent guarantee insurance.

• You should have a signed tenancy agreement

• Two form of tenant identification should be obtained from your tenant along with their photograph.

• Proof of the tenant’s employment.

• You must collect one months rent in advance and a dilapidation deposit before the property can be occupied by the tenant.

• Maintain a record of those rents paid and those which are due

• An approved tenant reference service must refer the guarantor, if the tenant needs a surety.

• In countries like UK and US, Complete tenant reference should be got and verified by a professional referencing company. Each tenant will be referenced by a licensed tenant referencing service.

Choosing your Insurance

Your insurance protection may vary depending on the standard coverage included in your policy and the optional coverage you purchase. Landlords who want minimal coverage to protect their property from major causes of loss, such as fire, wind or explosion, should consider a named peril policy. A named peril policy actually names the types of losses that will be covered in the policy. Besides the base coverage within your policy, you will need to decide what optional coverage to include. These can include but are not limited to: liability, loss of rents, other structures, theft, personal property, earthquake, and vandalism and malicious mischief (sometimes included in the policy).

Determine what you want your policy to do for you in the event of a claim. There are two common methods of loss settlement i.e. Actual Cash Value settlement and Replacement Cost settlement. Actual Cash Value settlement pays only for the current value of your property, which is the cost of replacement minus depreciation based on age and wear, up to the limit in the policy. Replacement Cost settlement pays you the amount needed to replace your property, without deduction for depreciation, with new property of like kind and quality, subject to any applicable deductibles and coverage limits.

Companies offering Insurance

General Insurance Corporation of India through it subsidiaries like United India Insurance, Oriental Insurance, the National Insurance Company, New India Assurance etc will give you guarantee for your house and valuables and give you peace of mind from all the unpredictable risks. Besides the government companies there are also several private companies which offer Insurance schemes such as MetLife, Royal Sundaram Alliance, ICICI Lombard, Tata-AIG, Bajaj Allianz General Insurance Company etc.

Review your policy each year to make sure it is still providing you with the coverage you want. Values of properties can fluctuate each year due to your improvements or housing market conditions. Your policy can be renewed annually and you can cancel a policy at any time. Determine what you want your policy to do for you in the event of a claim. Contact your insurance providers in your city or locality to know more details such as Insurance Quote, methods of loss settlement, optional coverage available, requirements to make a claim etc.