Housing benefit, legal implications

Mrs_pbradley936

Hi Everyone,

Some of us on another thread want to know the legal implications of a landlord not knowing that their tenants are claiming Housing Benefit. Here is a post I made on the thread:-

"Some people may not be aware that if a tenant is on HB the property insurance is a lot higher. Unless the landlord wants the hassle of changing the premium then it is easier just to decline such tenants. Not sure what the legal implications would be if Landlord not aware of the situation and had HB tenant then needed to claim."


Tried putting this on the insurance thread but nobody seems to be reading it!

bluejake

It is impossible for the landlord to know if a tenant is in receipt of Housing Benefit, or not, if the tenant decides not to tell him. Housing Benefit will certainly not inform a Landlord if the tenant chooses to have benefit paid direct to themselves.
So I am dubious that an insurance company would refuse a payout based on this; for one thing it is not possible for an insurance company to find out if a tenant is claiming housing benefit or not. Remember a tenant has no relationship with someone else's insurance company.
At any point during a tenancy a tenant may claim Housing Benefit and no one other than the claimant and Housing Benefit would know. As you would expect giving out information to a third party about a person's financial details is strictly controlled and Housing Benefit do not do this wily nily. I expect this is just a bit of marketing monkey business from the insurance company. Why not ask the insurance company in question: how in God's name am I expected to lawfully find out if a tenant is claiming Housing Benefit or not apart from asking them? And what if they tell me a fib?

Mrs_pbradley936

Thanks for that but when you are taking out insurance for a place you intend to let out you have to say if the tenants are working, students or claiming benefit. The premiums are different accordingly.

Bagpuss1973

Not sure if I am being dense?

You can be working and claiming housing benefit so how would that work with the said insurance company, I can't see that it should make any difference?

Surely if it was a legal issue the housing benefit department would be obliged to tell any landlords?

bluejake

Well why don't you ask the insurance company what happens if your tenant claims housing benefit without telling you or for that matter stops being a student and gets a job or becomes unemployed and claims Housing Benefit or whatever and does not tell you. I am sure tenant's circumstances must change all the time. And I am also sure Landlords do not evict tenants, who for example, stop being a student and get a job, so long as they pay the rent. And if they did tenants would simply not tell the landlord.
Apart from you asking your tenant,and your tenant telling the truth, it is not possible for you to know, so you should seek clarification from your insurance company. Maybe that is all they expect you to do: ask the tenant and do what you reasonably can to keep them informed.

bluejake

Bagpuss1973 wrote:

Surely if it was a legal issue the housing benefit department would be obliged to tell any landlords?

Certainly not. You wouldn't be happy if your bank, a government department or other agency gave out information about your personal financial circumstances or family would you?

They do give out information to organisations like the Police and to other Local Authorities when they are investigating criminal offences or attempting to detect fraud. But this is strictly controlled.

As for telling Landlords, absolutely not.

Fran

If insurance taken out is based on the facts of whether student etc., then this is part of the contract with the insurance co. It's no good in law if eg. the insurance co. have cancelled your claim and you didn't know about it... you would still get done because you have no insurance whether you knew or not. I would have thought the same would apply in this case and of course insurance companies will be looking for any excuse not to pay out.

black-saturn

What would happen if you had a tenant who paid the rent themselves who got made redundant? That tenant would have to claim HB until something else came along and the landlord can't evict them just because they are in receipt of HB. I don't think it makes any difference to the insurance.

I believe that as of April 2007 ish HB are going to be paying amounts straight to tenants anyway and stop paying amounts to landlords. They are in this area (East Anglia) anyway so I don't know if it's everywhere. They are doing this so that a tenant need not tell their landlord whether they are on HB or not. I think it's because of the prejudice against HB tenants and the long list of HB tenants waiting for places to live.

Discount_diva_5

black-saturn wrote:

What would happen if you had a tenant who paid the rent themselves who got made redundant? That tenant would have to claim HB until something else came along and the landlord can't evict them just because they are in receipt of HB. I don't think it makes any difference to the insurance.

I believe that as of April 2007 ish HB are going to be paying amounts straight to tenants anyway and stop paying amounts to landlords. They are in this area (East Anglia) anyway so I don't know if it's everywhere. They are doing this so that a tenant need not tell their landlord whether they are on HB or not. I think it's because of the prejudice against HB tenants and the long list of HB tenants waiting for places to live.

A tenant has never been obliged to tell a landlord that they claim Hb, as HB is a means-tested benefit, not a payment of rent. Really, it's none of the landlord's business if the tenant is a claimant or not- rent shoud be collected by a landlord, irrespective of the tenant's circumstances. Therefore, this insurance thing is a nonsense, a landlord cannot be expected to know

black-saturn

Discount_diva wrote:

A tenant has never been obliged to tell a landlord that they claim Hb, as HB is a means-tested benefit, not a payment of rent. Really, it's none of the landlord's business if the tenant is a claimant or not- rent shoud be collected by a landlord, irrespective of the tenant's circumstances. Therefore, this insurance thing is a nonsense, a landlord cannot be expected to know

Thats what I said in the other thread. Thanks for wording it better than I did.

msmicawber

I'm intrigued - what type of insurance is it that you're referring to? I can't see how tenants being in receipt of HB could affect the buildings or contents insurances, so is it insurance against rent defaults and tenants doing a moonlight flit?