Landlord Insurance for Housing Benefit Tenants

When you are looking for cover for your let property, any insurer needs to know the use to which the premises are going to be put – and this includes the type of tenant to whom you intend to let the property.

That is the key to understanding what makes landlords’ insurance for housing benefit tenants – and tenants who are unemployed – a specialist and critical form of cover if these are among the occupants your buy to let business targets.

Why do you need housing benefit insurance?

There is one very good reason why you may need specialist landlord insurance for tenants on housing benefits or those who are unemployed (i.e people who are in receipt of Universal Credit) – and that is because many regular insurers impose specific exclusions on letting to this category of tenants.

You might even have found that your buy to let mortgage lender imposed similar conditions excluding such tenants in order for you to secure the loan to buy the property in the first place.

Their argument is that tenants in receipt of welfare benefits – whether housing or unemployment benefit – make less reliable and more troublesome tenants:

• many might not have the deposit you typically ask of other tenants as security against damage or breakages;
• not all such tenants are able to arrange for you to be paid their housing benefit directly from the local authority;
• arranging housing benefit in any case involves a considerable amount of red tape – including means testing; and
• the benefits are paid in arrears – when you typically ask tenants to pay their rent in advance – and there may be a qualifying waiting period before any housing benefit or unemployment benefit is paid.

You might think it unfair that many insurers tar all such tenants with the same brush, since your own experience has shown that those on low incomes, the unemployed, or others in receipt of DSS benefits make perfectly reliable and trustworthy tenants – and your particular buy to let business relies on the rent you receive from them.

What you need to know when buying Universal Credit tenants insurance cover

When you are looking to buy let property insurance for housing benefit tenants, or those who are unemployed, there are a number of factors to keep in mind:

• what is your likely target market – and is that likely to include tenants who may be unemployed or in receipt of housing benefit;
• have you conducted the normal background checks before granting any tenancy – such as written character references and credit checks (likely to be especially important if you are also looking for housing benefits tenants);
• does the landlord insurance for housing benefit tenants in which you are interested impose any restriction on the types of tenants who may occupy your property;
• are you arranging sufficient building and contents insurance to cover all risks – including the possibility of malicious damage caused by tenants (by no means all policies include such risks);
• have you arranged adequate landlord liability insurance – to protect against claims from tenants who sustain an injury or have their own property damaged in the property and hold you liable; and
• does the policy offer adequate compensation for possible loss of rental income following a major insured incident which leaves the premises temporarily unlettable.

Why choose us?

When you ask us to arrange your landlord insurance for housing benefit tenants or your let property insurance for unemployed tenants, you may rest assured that cover is extended for any class or type of tenant you care to choose – although the normal precautions continue to be expected, of course, in the background checks you make before reaching any tenancy agreement.

It is products such as these, and our attention to first-rate customer service, which have helped us become one of the leading independent, online property insurance brokers in the UK.