If something happens to your rental property building or its contents, you can rely on your landlord insurance to help pay the bills. But what happens if your tenants and their property are injured or damaged because of something that is your responsibility? In this guide, we explain what public liability insurance is, and outline four important reasons why landlords might need it.
Keeping your tenants and your investment safe
Landlords have a duty to ensure their tenants are as safe as possible. There are strict regulations surrounding electrical and gas safety that you must comply with. Landlord insurance helps you to meet these regulations by paying out to put right any damage to essential safety equipment, such as smoke alarms.
But there are also lots of other hidden dangers in your property that could cause an injury to your tenants or damage their things. Even with the strictest maintenance routine, simple things like a loose floorboard could lead to an accident that your tenant blames on you. And that’s where public liability insurance can help.
First, what is public liability insurance?
Public liability insurance pays your legal costs if someone (a tenant, a contractor, or a member of the public) makes a claim against you for injury or damage to property. It pays the solicitor fees to defend your case and any compensation awarded. It also pays for the claimant’s legal fees if these are awarded.
Regularly inspecting and maintaining your property (or properties) can help avoid many injuries or damage occurring. But things can and do still go wrong. In those cases, public liability insurance for landlords offers the peace of mind that you’re protected financially.
Next, why do landlords need public liability insurance?
1) Compensation for an injury to a tenant or a visitor to your property can be very high.
As a landlord, you must keep your rental property safe and free from health hazards. If there is a problem in the property that is your responsibility and someone is hurt then you can be held financially liable. For example, if a floorboard becomes loose as it has not been properly maintained and your tenant trips and is injured, your tenant can sue you for financial compensation for the injury. This can include medical bills and lost income, so costs can quickly mount. If the injury results in permanent disability or death, the compensation awarded can skyrocket. Public liability insurance takes care of all the legal costs for your peace of mind.
2) Damage to property can lead to high bills.
Your tenants or visitors to your property can make a claim against you if they feel you are responsible for damage to their things. For example, if a leaky pipe results in water damage to your tenant’s TV. In this case, they can sue you for a replacement TV. Electrical items, designer wardrobes, and soft furnishings can all be very costly to replace. Public liability insurance will cover your legal bills and replacement costs.
3) We live in a no win, no fee, litigious world.
Switch on the TV and you’re likely to see an advert for a legal firm asking if you have suffered an injury. It’s easier than ever for a member of the public to bring a claim against you. With no win, no fee options, they have nothing to lose. Even if you prove you are not liable, it can cost a lot of money to defend your case. With public liability insurance, you can rest assured that all your legal costs are covered.
4) Financial protection for you and your tenants
Legal fees are notoriously high, and compensation for permanent disability can run into tens of thousands of pounds. With public liability insurance, you can be confident that you are protected financially. More importantly, you can be reassured that if something does happen then your tenant, or another member of the public, can get the money they deserve.
What happens if I don’t have public liability insurance for my rental property?
There is no legal requirement for landlords to hold public liability insurance. However, if you don’t have it, you will be financially liable for claims against you.
Finally, can I claim tax relief on public liability insurance?
Yes, like all insurance, you can claim tax relief on the cost of your public liability insurance for landlords.
Other insurance for landlords
Public liability insurance is just one of a whole range of products designed to protect your investment. For example, other areas of insurance that you might want to consider include:
- Building insurance. This is the most basic level of landlord insurance cover. For example, it will pay out in the event of damage to the building that you rent – for example, if there is a fire or flood that damages the building.
- Landlord’s content insurance. This is aimed at landlords that offer a fully furnished house or flat for rent. It will pay out if any contents are damaged through fire or flood, or are stolen. There’s also the option to extend this cover to accidental or malicious damage. This is likely to be useful if you rent out holiday accommodation (a Furnished Holiday Let) or if you provide any items in your long-term let. Don’t forget, contents include white goods like fridge freezers and washing machines.
- Loss of rent insurance. If your property is damaged or becomes uninhabitable then you won’t be able to rent it, and that can affect your cash-flow. Loss of rent insurance can cover you for these periods ensuring regular bills can still be paid.
Speak to our property owners’ team at Park Insurance
At Park Insurance we have a dedicated property owner’s team that understands the specific insurance needs of landlords, including public liability risks. We can talk you through all the options available and put together a tailored package that meets your requirements and budget. Then, as an independent firm of brokers, we’ll shop around on your behalf to negotiate a great price deal.
For more information, please call us on 0117 955 6835 or get in touch.