Landlord insurance vs home insurance

Home insurance can cover several risks you may face as a homeowner, such as rebuilding your house if it burns down, replacing the possessions stolen in a break-in, or paying medical bills if someone is hurt on your property.

However, if you decide to rent out your home, a regular home insurance policy may not be sufficient, and you may need some extra cover options designed especially for landlords.

How is landlord insurance different from home insurance?

There are two main types of home insurance cover: protection for your home (the building) and your belongings in it (contents). Landlord insurance offers three types of cover: building, contents and business. In this case, “business” refers to renting your property out to tenants.

Landlord insurance may cover everything that your building-only home insurance does, and offer extra protection for specific problems you may face as a landlord. For example, if you experience loss of rental income, need to repair damage caused by tenants, or need to pay legal expenses to evict a tenant, standard home insurance will not provide cover, but landlord insurance usually will.

What’s included in a landlord insurance policy?

While the exact inclusions, exclusions and extras will differ between providers, most landlord insurance policies will include cover for:

Building and contents

Similarly to other home insurance policies, landlord insurance will typically cover your rental property against any damage caused to the structure of the property from fire, flooding, vandalism, theft, and more. It may also offer limited contents insurance, covering damages to any of your own possessions in the house (but not the tenant’s), such as carpets, curtains, kitchen appliances and furniture. 

Loss of rent

Landlord insurance will sometimes provide cover in case of rent loss, which includes the tenant failing to make rental payments, eviction of the tenant by court order, or the death of the tenant. In most cases, you will also get cover for the fees incurred if you require legal support while evicting a tenant. 

Public liability

If a person trips on a tree root in the driveway or tumbles down the stairs and injures themselves in your property, landlord insurance may provide public liability cover for the medical and legal costs.

Damage by tenants

Tenant damage is a standard inclusion in many landlord insurance policies, which provides cover if your tenant or their visitors cause accidental or malicious damage to the property. Some policies may have separate covers for malicious damage and accidents, so ensure you read the PDS document carefully.

Is there a difference between renter’s insurance and landlord insurance?

Renter’s insurance and landlord insurance are both intended for use in rental properties, but offer different cover to better suit different customers.

While landlord insurance will often cover any damage to the property caused by the tenant, a tenant is responsible for insuring their own possessions, including their clothes, furniture, electrical appliances, books, and other belongings. So, if a disaster occurs, tenants could potentially lose everything and miss out on compensation.

If you’re a tenant, it may be worth looking into renter’s insurance, which is a specialised type of contents cover for people living in rented properties. As well as covering the home’s contents, renter’s insurance may also cover tenant-specific risks such as providing temporary accommodation if the home was to burn down. If you’re a landlord, some agents recommend making renter’s insurance a condition of your lease.

Is home insurance required if you already have landlord insurance?

If you take out building and contents insurance as part of your landlord insurance, you may not need an additional home insurance policy - depending on what the policy covers. But, if your landlord insurance only covers tenant protection, your property may not be protected.

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