In 2014, AXA conducted research into a representative sample of landlords and people currently renting property across all regions within the United Kingdom. Some of their findings are pretty shocking, outlining the importance of landlord insurance….
The research has shown that landlords are not doing enough to protect themselves and their property investment. But, accidental landlords are the ones who have been found to be most at risk of renting to bad tenants and buying incorrect insurance policies, leaving them the most vulnerable of landlords.
According to the research:
- 26% of tenants pay their rent late.
- 18% have kept pets without their landlord’s permission.
- 15% have received complaints from neighbours for excessive noise.
- 8% have sub-let to someone else without the landlord’s permission.
- 8% admit to committing a crime on the landlord’s premises.
- 10% say they’ve had police call round to the property.
These figures initially are quite startling, but when more and more homeowners are becoming accidental landlords, it honestly makes sense. Many landlords who rent a single property didn’t buy the property with the intention of renting it out; their financial circumstances in this current climate have led them down the rental route. But with that comes great risk if new landlords do not take the time to educate themselves on the risks and legalities of renting out their homes first.
According to AXA, 38% of landlords don’t carry out checks on their prospective tenants and only 5% of landlords actually conduct a criminal background check. In addition to this, only 29% of landlords ask for previous landlord references and 27% ask for employer references. By not taking care in the tenant selection process, you could be letting yourself in for more than you bargained for. With inexperienced accidental landlords, dealing with a bad tenant can be extremely stressful so ensuring that you carefully select your tenant is worth the extra effort.
1 in 4 residential landlords have inadequate or no insurance protection at all. Not having the correct insurance policy puts both the landlord and the tenant at risk. Among those within the research sample who bought the wrong insurance for the rent property, 43% admitted that they were simply unaware of the existence of landlord cover.