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Valuing the Contents of Rental Property for Landlords

How best to value the contents of your rental property in order to get the right insurance.

Joining the world of landlords is both an exciting and nerve-wracking process. Taking on your first rental property can bring great rewards, but when it comes to renting out your properties, it’s more important than ever before that you’re dotted your I’s and crossed your T’s, particularly when it comes to insurance.

There are some particular things you need to remember when organising your landlord insurance to make sure your property is valued right, and that you’re covered for every eventuality because when your tenant calls you on Christmas day about their broken boiler, you need to know you can get it fixed.

First up, it’s important to remember that you will need a specialist landlord insurance policy. This is because standard household insurance often doesn’t cover for buildings, contents and third party damage while the building is being let to tenants. You’ll want your insurance to cover two things; buildings, which includes all structural damage, and contents, which includes fixtures and fittings like carpets, white goods, curtains etc (it’s easy to overlook the fact that these count as contents when you first start as a landlord). Unless you have a lot of other valuable contents in your property, the basic cover is often enough, but bear in mind that policies often only cover stolen goods where there is actual evidence of forced entry so if your tenants decide to run off with your fridge, make sure you’ve covered for this by asking for a suitable deposit.

If you’re renting out a fully furnished property, including all furniture beyond basic fixtures and fittings, then it’s important to make sure you have arranged extra cover for this basic landlords insurance probably won’t be sufficient. But it is simple to add further contents insurance to any policy.

When insuring your property, while quotes can add up to significant three figure sums, don’t be tempted to underinsure. Think of this as business insurance, after all you are running a commercial venture. While it may save you money in the long run, that building is an investment for your future, and if you’re not covered to protect against damage, the money can end up coming out your pocket in much larger sums further down the line. In the end, if you don’t look after your property, then you’re risking it losing value, and you losing money on your investment so make sure you find a good insurance broker to advise you on the best deal.

Of course, when it comes to buildings cover, it can be hard to know how to value your property. You can probably gauge the value of your fixtures and fittings, but property values change over time, and different buildings constructed in different eras will need different cover. When it comes to making such a valuation make sure you bear in mind the age of your property, it’s location, it’s size, and it’s type of construction. If you’re having trouble, then good insurance brokers should be able to offer you accurate and trustworthy advice.

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