How does landlord insurance work in Ireland?

What is landlord insurance?

It’s an insurance policy for your rental property, also known as buy to let insurance.

It can include buildings and contents cover and protect you financially from loss of rent and third-party claims.

Why do you need it?

Landlord cover isn’t a legal requirement, but some lenders require it as a condition of getting a buy to let mortgage.

Renting your property comes with more risks than living in it. You’re relying on the tenant to look after your home and are liable for any accidents on the property.

A standard home insurance policy doesn’t offer all the protection you need to minimise these risks, but landlord insurance can.

What does it cover?

Most landlord insurance policies include cover for:

• Buildings insurance: This covers the cost of repairing or rebuilding the property, e.g., if it suffers damage from fire or flood. This can include permanent fixtures and fittings, outbuildings and boundary walls or fences.
• Contents insurance: This protects your belongings e.g. furniture, appliances, TV and furnishings from theft and damage caused by fire and flood. Look for policies that include new for old replacements.
• Third party claims: This is also known as public liability and can protect you financially from a tenant suing you for an accident in the property.
• Loss of rent: If the property becomes uninhabitable due to damage, you can continue to receive the rent you would have received, up to a percentage of the building sum insured, e.g., 15% of the rebuild cost.
• Rent guarantee: If your tenants default on their rent for two or more months, you can claim the missed payments. You can also claim for loss of rent during the gaps between existing tenants leaving and new tenants moving in.

What extras can you add?

If these things aren’t included as standard, you may want to consider adding them to your policy:

• Accidental damage: This covers unexpected mishaps e.g. a carpet spillage that may be expensive to treat or replace.
• Home emergency cover: If your heating, boiler, or home electrics fail, a professional will come and fix it, often 24/7, with this type of cover.
• Legal cover: This may be included in public liability cover but check. If you have problem tenants, you may need legal advice and assistance in evicting them.
• Unoccupied insurance: Some policies only cover your property if it’s unoccupied for up to 30 days, which may not be long enough, for example, to find new tenants. You can pay to extend this period if you can’t find a policy with the level of unoccupied cover you need.

What affects the cost?

The cost of the policy depends on several things including the:

• Property rebuild cost: The higher it is, the more you’ll pay. Here’s how to check the rebuild cost of your property.
• Property’s location: Areas with higher crime statistics will make your policy more expensive.
• Contents cover: The more expensive your furnishings are, the more you’ll pay to protect them, especially if you opt for old for new replacement cover.
• Number of tenants: The more there are, the higher the risk so you’ll pay extra.
• Number of properties: You’ll pay more for multiple properties than a single property but the price per policy may work out cheaper.
• The type of tenants:. You may pay more if your tenants are getting help to pay for the rent as they’re more likely to default on their payments. e.g. families or tenants receiving welfare benefits.
• Policy on pets: If you allow pets, the premium can increase, but it depends on the type of pet. For example, certain dog breeds are more likely to attack, which could result in an expensive liability claim.

How to make it cheaper

It’s important to get the cover you need rather than the cheapest policy, but here’s how to save:

• Ensure the property is secure and consider installing an alarm
• Only pay for the buildings and contents cover you need
• Shop around for like for like quotes
• Check for offers on new policies and multi-policies with an existing insurer
• Buy online and seek out discounts
• Pay upfront if you can, to save paying interest on monthly payments
• Only pay for the extras you need

Here are more ways to save money on your home insurance.

Landlord insurance FAQs