0:01 AM, 25th September 2024, About 2 months ago
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Subletting has become a common practice in recent years but can be dangerous especially if a tenant is subletting without the landlord’s permission.
But did you know standard landlord insurance doesn’t cover subletting?
Here at Property118, we’ve teamed up with The Home Insurer who can help with subletting and landlord insurance.
Subletting happens when a tenant rents out part or all of their home to someone else. For example, they might rent a room to another person while still living there, or they could rent out the entire place and live somewhere else.
In either case, the subtenant pays rent to the tenant, not directly to the landlord.
Landlords can also sublet their property to a housing association or through a letting agent which can boost their rental income.
However, many landlords don’t realise that subletting is not usually covered by landlord insurance.
This means that if there’s an issue with the property, your insurance might not cover it, leaving you responsible for any repairs or damages out of your own pocket.
One aspect of subletting that landlords may not realise is if the local council is putting benefit tenants into their property, they need to have a separate insurance policy which covers this.
Jason McClean, director of The Home Insurer, explains: “We have landlords come to us who sublet and some of them don’t even realise.
“Landlords might sometimes have a local council putting in benefit assisted tenants into their properties, and the contract is between the landlord and the council, but the tenancy is between the council and the tenant which needs a totally different sort of insurance.
“You need sublet or rent-to-rent insurance – standard landlord insurance won’t cover it.
“Many landlords don’t see that and just stick their head in the sand and go to another insurance company to find the cheapest quote possible and if they’ve had a claim, they’ll get it refused which is a real shame.”
The Home Insurer can help with a variety of specific requirements for landlords, including subletting insurance.
Jason said: “We can solve these problems for landlords if they have mixed tenancies and benefit tenants; you name it we can deal with it.”
Subletting isn’t illegal, but if your rental contract explicitly prohibits it, then it’s a breach of contract.
If you are happy with your tenant subletting, they will need your permission first and you must put this in the rental contract.
If you discover your tenant is subletting without your permission, you have the right to start eviction proceedings against them.
It’s important to know that if subletting results in three or more tenants in your property, it could be classified as a House in Multiple Occupations (HMO).
An HMO has stricter legal requirements, and you may also require specialised HMO insurance and possibly an HMO license depending on local regulations.
If you wish to sublet your property, it’s important to speak to your insurer first as many won’t allow subletting on a standard landlord insurance policy.
If you are thinking about letting your tenant sublet, then it’s a good idea to talk to your insurer first. They can help you find the right policy that fits your situation and protects you from risks.
The Home Insurer prides itself on delivering the best service and puts clients at the heart of the business.
Jason McClean, the firm’s director, says: “I think we try to solve property insurance problems for people at the best price possible. We are also amongst the lowest priced landlord insurance providers in the UK.
“If you go for the very lowest possible quote with a different insurance company, whenever you have a claim or need to speak to that insurer, you probably won’t be speaking with the same person. You may not welcome the long phone waits, multiple menu options and being cut off either; that’s my experience of big call centres and think many feel the same.
“Here at The Home Insurer, you can ring us up and speak to the same person who deals with your policy all year long. There is only a 15-second FCA prescribed message before you are talking to a real person.”
With The Home Insurer, you get peace of mind knowing you are covered for everything you need.
You also have the unique advantage of speaking to the same friendly adviser who deals with your insurance policy without going through a complicated automated system or being passed around different departments.
Making sure you have the right insurance coverage for subletting is hugely important.
The Home Insurer can give you peace of mind and help provide the right cover and protection for your property.
