Letting agents and landlords can increase protection and peace of mind for all stakeholders in a rental transaction by encouraging renters to take out tenant liability insurance.
As well as protecting a landlord’s investment, liability insurance can improve trust and increase the chances of long-term tenancies, according to leading rental market service provider Tenant Shop.
Tenant liability insurance covers renters for accidental damage to furniture, fixtures and fittings that they are responsible for under their tenancy agreement. Policies are often included in many contents insurance policies.
Although not a requirement, some landlords or letting agents request that renters take out a liability policy before a tenancy is granted.
Protecting properties remains crucial
Alongside providing tenants with safe accommodation, protecting their investment will be a top priority for most landlords.
In the event of accidental damage to a rental property, a claim can be made if renters have tenant liability insurance.
Not only will this save the landlord money, it also means the tenant reduces the risk of having to fund any repairs or replacement items out of their own security deposit at the end of the tenancy.
“Tenant liability insurance provides a win-win situation. The tenant improves their chances of getting their full deposit back at the end of the contract, while the landlord can remain satisfied that they shouldn’t have to foot the bill for potentially costly accidental damage,” says Glenn Seddington, managing director of Tenant Shop, an Inchora company.
“This can contribute towards fewer deposit disputes between landlords and tenants, helping tenants to receive their deposit back quicker and giving landlords the opportunity to prepare for the next tenancy effectively,” he says.
Trust is the key to tenant-landlord relationships
It’s well-known that trust is central to a healthy relationship between tenants, landlords and letting agents.
If landlords and agents know the property is protected by insurance and tenants feel they have a high chance of getting their deposit back, levels of trust can be maintained and improved.
“When there are trust issues between landlords, agents and tenants this can lead to access obstructions and failure to report maintenance issues which could cause long-term problems,” Seddington continues.
“On the flipside, a lack of trust can also be problematic for tenants, leading to maintenance requests not being dealt with quickly or landlords failing to show discretion if they have a personal issue which affects their tenancy.”
“Fractured relationships can increase the chances of deposit disputes, the need for evictions and ultimately void periods. Tenant liability insurance is one of many important factors that can help to build trust between stakeholders and subsequently avoid these negative issues,” adds Seddington.
Better conditions for long-term tenancies
Increased trust and a solid level of protection creates a scenario where long-term tenancies can thrive and all parties benefit from the rental transaction.
“For landlords and letting agents, maintaining long-term tenancies with reliable renters will always be a principal aim, while many tenants will also be keen to have access to stable accommodation from a landlord they trust for an extended period of time,” says Seddington.
“Of course, not all tenants will want a long-term tenancy, but measures like liability insurance, looking after the property and paying rent on time can contribute towards building trust and providing them with the opportunity to stay as long as they want in a happy living environment,” he says.