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Tenant/Lodger Insurance Dilemma
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Dragon90
Posts: 6 Forumite
I'll try and keep this long story short but any help you guys could give would be greatly appreciated!
So in August 2014 I moved out of my own 1 bed flat and into one bedroom in my cousin's (2nd, once removed) house. We were essentially doing each other a favour, I could no longer afford to live alone in London and she, having inherited the house from her recently deceased parents was in the process of buying out her brother from his share of the house, and needed someone to house sit as she primarily lived in America with her husband. The situation as I understood it at the time was that my cousin would occasionally be visiting to clear the house and get essential work done before eventually letting another room out, the third bedroom remaining as her own for when she was in the country.
We are now coming up on two years down the line and very little work has been done clearing the house or on "essential" maintenance and decorating except for in the garden (gardening being her obsession). The only change being she now fully owns the house and the purchase of her brother's share was made via acquiring a buy to let mortgage, something that was completed at the end of last year. In January of this year, after an unsuccessful attempt by her to move in a tenant she sourced last September, a close friend of mine took a second bedroom in the house. Until this point our arrangement was quite casual - I've paid a set amount of rent pcm since moving in that includes all bills and there have been no formal house rules or regulations beyond setting the alarm when you leave and making sure the door is locked at night.
With the arrival of my friend and the completion of her buy to let, the arrangement has become more formal - we have been given a printed set of house rules, some of which were completely unreasonable but we all sat down to discuss them together on her last visit and worked out the issues we had (some of which are still ongoing but that's a story for another time). One of the main problems we have is contents insurance.
From my cousin's point of view and her mortgage lender we are tenants she lets the house to, however she lives in the house with us on a regular basis which legally places us as Lodgers and therefore make us virtually uninsurable. She has a buy to let mortgage so technically shouldn't be living in the house at all but she spends 4-6 week periods living with us with 3-5 week gaps where she's in America between. April 2015 - April 2016 she spent 175 days total (approximately) in the UK. From April 2016 and factoring in her next planned trip we will be at 65 days for this year so far.
We advised her after speaking to a few insurance companies who said they wouldn't cover us with Tenant's contents because we don't have exclusive access to our home or our bedrooms within the house (She mostly asks permission to enter but both of us have experienced coming home to windows being opened that we left closed or dehumidifier things being placed on our window when she hasn't asked to come in) and because she is, by the insurance companies, classed as a live in landlord. In addition, if someone were willing to cover us as tenant's we would then need her to provide a tenancy agreement for us to sign (not an issue, she is prepared to do this).
Her response to this dilemma was to put us in touch with her insurance broker who in turn referred us to a different broker. After several attempts I managed to speak with him today and he agrees that we can't be insured as tenants and while he's looking into it further because it's an unusual situation, he's pretty sure the best he'll be able to do for us is forced entry cover for our contents. This is not what we need as we still want cover in the event of fire or flood and also because my cousin has a habit of inviting people to stay when she is here without asking permission from us (last month it was a "friend" who didn't know her name after he had to temporarily move out of his own house after a fire), we have cleaners who have a key and know the alarm code and also several neighbours and friends of my cousin who also have keys/alarm code knowledge and we have no way of securing our belongings. Also if the broker is able to sort something we then have to pay for his services which we're not entirely sure we can afford.
We're currently uninsured because of the situation and don't know what to do. Any advice from anyone who's been in a similar situation would really help!
So in August 2014 I moved out of my own 1 bed flat and into one bedroom in my cousin's (2nd, once removed) house. We were essentially doing each other a favour, I could no longer afford to live alone in London and she, having inherited the house from her recently deceased parents was in the process of buying out her brother from his share of the house, and needed someone to house sit as she primarily lived in America with her husband. The situation as I understood it at the time was that my cousin would occasionally be visiting to clear the house and get essential work done before eventually letting another room out, the third bedroom remaining as her own for when she was in the country.
We are now coming up on two years down the line and very little work has been done clearing the house or on "essential" maintenance and decorating except for in the garden (gardening being her obsession). The only change being she now fully owns the house and the purchase of her brother's share was made via acquiring a buy to let mortgage, something that was completed at the end of last year. In January of this year, after an unsuccessful attempt by her to move in a tenant she sourced last September, a close friend of mine took a second bedroom in the house. Until this point our arrangement was quite casual - I've paid a set amount of rent pcm since moving in that includes all bills and there have been no formal house rules or regulations beyond setting the alarm when you leave and making sure the door is locked at night.
With the arrival of my friend and the completion of her buy to let, the arrangement has become more formal - we have been given a printed set of house rules, some of which were completely unreasonable but we all sat down to discuss them together on her last visit and worked out the issues we had (some of which are still ongoing but that's a story for another time). One of the main problems we have is contents insurance.
From my cousin's point of view and her mortgage lender we are tenants she lets the house to, however she lives in the house with us on a regular basis which legally places us as Lodgers and therefore make us virtually uninsurable. She has a buy to let mortgage so technically shouldn't be living in the house at all but she spends 4-6 week periods living with us with 3-5 week gaps where she's in America between. April 2015 - April 2016 she spent 175 days total (approximately) in the UK. From April 2016 and factoring in her next planned trip we will be at 65 days for this year so far.
We advised her after speaking to a few insurance companies who said they wouldn't cover us with Tenant's contents because we don't have exclusive access to our home or our bedrooms within the house (She mostly asks permission to enter but both of us have experienced coming home to windows being opened that we left closed or dehumidifier things being placed on our window when she hasn't asked to come in) and because she is, by the insurance companies, classed as a live in landlord. In addition, if someone were willing to cover us as tenant's we would then need her to provide a tenancy agreement for us to sign (not an issue, she is prepared to do this).
Her response to this dilemma was to put us in touch with her insurance broker who in turn referred us to a different broker. After several attempts I managed to speak with him today and he agrees that we can't be insured as tenants and while he's looking into it further because it's an unusual situation, he's pretty sure the best he'll be able to do for us is forced entry cover for our contents. This is not what we need as we still want cover in the event of fire or flood and also because my cousin has a habit of inviting people to stay when she is here without asking permission from us (last month it was a "friend" who didn't know her name after he had to temporarily move out of his own house after a fire), we have cleaners who have a key and know the alarm code and also several neighbours and friends of my cousin who also have keys/alarm code knowledge and we have no way of securing our belongings. Also if the broker is able to sort something we then have to pay for his services which we're not entirely sure we can afford.
We're currently uninsured because of the situation and don't know what to do. Any advice from anyone who's been in a similar situation would really help!
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Comments
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You are tenants, not lodgers.
Your cousin is a bit dim I fear.
I hope you are deducting the tax from the rent?0 -
My cousin is the one who considers us tenants, all outside people we've discussed the situation with (the broker and various insurance companies) state we would legally be considered lodgers because she is technically a live in landlord.0
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My cousin is the one who considers us tenants, all outside people we've discussed the situation with (the broker and various insurance companies) state we would legally be considered lodgers because she is technically a live in landlord.
Their idiots too then.
She resides abroad, for over 180 days of the year, she does not therefore legally reside in the UK0 -
She has a UK bank account, GP, passport, car, dentist, financial advisor - I could go on! She was born here and is not an American citizen (as far as I'm aware) but her husband is. Regardless of if you think they're idiots or not by law we're considered lodgers by her presence in the house, even if it was only one week of the year, as we do not have exclusive access to the home or our rooms within it because of that. That's the law. It may be stupid but that's what it is. Calling people idiots isn't helping or advice tbh.0
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You're actually being incredibly rude. I asked for advice not to be attacked.
I can't change what the situation I've been told by the insurance companies is - I'm sure you could be right and have been right many times in the past but that doesn't change my situation right now. I explained it to them exactly the same as I did above and they see it as she is our landlord, she lives in our house therefore we're lodgers with a live in landlord regardless of her official country of residence. Whether my cousin is tax dodging or not I still cannot get contents insurance as a tenant because we don't have exclusive access to our home and right now I'm stressed and upset about the situation enough as it is without someone ranting at me anonymously on the internet.0 -
She has a UK bank account, GP, passport, car, dentist, financial advisor - I could go on! She was born here and is not an American citizen (as far as I'm aware) but her husband is. Regardless of if you think they're idiots or not by law we're considered lodgers by her presence in the house, even if it was only one week of the year, as we do not have exclusive access to the home or our rooms within it because of that. That's the law. It may be stupid but that's what it is. Calling people idiots isn't helping or advice tbh.
Whether she is born in the uk or not does not mean she would be classed as "ordinarily resident" in relation to access free non emergency or primary nhs care. The fact she is registered with a gp means nothing as a patient doesn’t need to be “ordinarily resident” in the country to be eligible for NHS primary medical care – this only applies to secondary (hospital) care.
A GP practice may be flexible in deciding whether to accept her as a registered patient and if visiting the UK for less than 3 months, they may accept her as a temporary resident. However there are certain services she may have to pay a fee for. residency status is not a determining factor in whether or not to accept a person as a registered patient.Spelling courtesy of the whims of auto correct...
Pet Peeves.... queues, vain people and hypocrites ..not necessarily in that order.0 -
You're actually being incredibly rude. I asked for advice not to be attacked. - I'm not attacking you, I'm telling you that the facts. there's a good chance the situation isn't explained properly to the insurance company. But I think insurance is the least of your worries if tax hasn't been paid correctly, as you are liable for that.
I can't change what the situation I've been told by the insurance companies is - a call centre worker for an insurance company isn't likely to be an expert on tenancy law. - I'm sure you could be right and have been right many times in the past but that doesn't change my situation right now. - it does, if you accept that you are in fact a tenant. I explained it to them exactly the same as I did above and they see it as she is our landlord, she lives in our house therefore we're lodgers with a live in landlord regardless of her official country of residence. - Stop telling them she lives there, she doesn't. Whether my cousin is tax dodging or not I still cannot get contents insurance as a tenant because we don't have exclusive access to our home - 1 you do. 2. you don't need exclusive access to your home to be a lodger. A tenancy can be for a room. and right now I'm stressed and upset about the situation enough as it is without someone ranting at me anonymously on the internet.
Hi I'm Guest, I'm here to help you. Just trust me on some things and we'll get on like a house on fire
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If you are tenants, then this is an HMO. You have exclusive occupation of your respective rooms (and she has exclusive occupation of hers) and you share the rest of the property.
Does it meet the local council's criteria for compulsory registration? Check their website.
Alternatively (and I favour this interpretation), this is her primary UK residence and you are lodgers.I'm surprised to hear lodgers cannot get contents insurance, either in their own names or under the landlord's policy, but try posting on the insurance board here?
ps - a quick google for 'possessions insurance' found https://possessions.endsleigh.co.uk/Details1/Page#/
It is designed for students so check if you have to be a student, but it appears to meet your need.0 -
If you are tenants, then this is an HMO. You have exclusive occupation of your respective rooms (and she has exclusive occupation of hers) and you share the rest of the property.
Does it meet the local council's criteria for compulsory registration? Check their website.
Alternatively (and I favour this interpretation), this is her primary UK residence and you are lodgers.I'm surprised to hear lodgers cannot get contents insurance, either in their own names or under the landlord's policy, but try posting on the insurance board?
Not often we disagree, but
Schedule 1 of the Housing Act 1988 provides, in summary, that a landlord is considered to be a resident landlord if he lives continuously in the same building (or in another dwelling which forms part of the same building) as his tenant, unless the two dwellings are contained in a purpose built block of flats.
Appreciate this is more for tax purposes: If you live abroad for 6 months or more per year, you’re classed as a ‘non-resident landlord’ by HM Revenue and Customs (HMRC) - even if you’re a UK resident for tax purposes.0 -
Just googled this and thats exactly what I thought it would say - I only checked as I thought we were going mad Guest101.
The OP seems to have taken someone elses interpretation of it on board.0
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