Rent guarantee checklist for landlords


Direct Line for Business

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Direct Line for Business

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Even the most trustworthy tenant could fall victim to financial difficulties and may stop paying rent. If you would struggle to pay your own bills without this income, it’s worth considering rent guarantee insurance, which is tax deductible if you claim the cost as a business expense. Here’s our checklist to help you find the right insurance for you.


Things to consider when choosing rent guarantee insurance

Shop around to find insurance that suits your needs. You can learn more about insurance by talking to a broker or your agent, checking on comparison sites and also via companies such as Direct Line for Business that only deal directly with you.


Check whether you can secure standalone rent guarantee insurance or if it’s offered as part of an ‘add-on’ to standard landlord policies.


Compare like with like cover by checking:

  • If rent guarantee covers you for all rent lost, e.g. from the same day tenants stop paying, or if you have to wait a month or more for insurance payments to activate?
  • How often and how much each claim can be. For example, is there a limit on the number of claims you can make and for each amount you can claim?
  • If there are any terms and conditions. For example, if you need to serve your tenant with an eviction notice to be able to claim.
  • The excess you need to pay and how this affects your monthly/annual payments.
  • After obtaining rent guarantee insurance, is there a time limit before you can make a claim?
  • Does the insurance cover lost rent if repairs are required after the tenant moves out? For example, Direct Line for Business pays 50% of the rent you would have previously received for up to three months or until the property is let.
  • Does the insurance cover properties abroad? For example, Direct Line for Business does not provide rent guarantee cover for properties in the Channel Islands or Isle of Man.
  • Does the insurance cover both residential and commercial properties? Make sure to check this if you have a mixed portfolio of properties.
  To secure rent guarantee insurance, the insurer may ask for:
  • Information regarding the contract you have in place with your tenants. For example, Direct Line for Business can cover residential landlords in England, Wales and Scotland whose tenants are under an assured shorthold tenancy, lasting six months or longer. For residential landlords in Northern Ireland, they cover rentals to which ‘The Private Tenancies Order 2006’ applies.
  • Tenant referencing, e.g. written references from previous agents, landlords and an employer, plus a credit history check (including the Enforcement of Judgements Office, County Court Judgements and bankruptcy). Some insurers may ask that these checks are undertaken by a licenced referencing service before the tenancy has begun.
  • A detailed inventory, including photos which the tenant has signed.
  • Up-to-date rental records.

Rent guarantee at Direct Line for Business

If you add rent guarantee cover to your landlord insurance, we'll provide cover for any unpaid rent, while the tenant still occupies the property. If your tenants can't pay, we will. Find out more here.

Cover purchased as part of Legal Expenses add on. Qualifying criteria apply. You can make a claim if you have correctly served your tenants with an eviction notice and the rent has been overdue for at least one month. Restricted claims for existing tenants in the first 90 days when product first purchased. Residential landlords only. Direct Line insurance policies are underwritten by UK Insurance Limited.


All our information is brought to you by Kate Faulkner, author of
Which? Property books and one of the UK's top property experts.
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