Advice required - Do I need landlord insurance?

Gloster_Wolf

I hope everyone is keeping well.

My partner and I have moved out of our family home recently and we've left two of our kids in charge of the house. They are living there rent free but have full responsibility for all bills.

The building and contents insurances are now due but my current insurer has told my partner that I require landlord insurance which I dispute.

My understanding of the term landlord is someone who leases land or property in exchange for rent, which we are clearly not receiving. My question, therefore, is, do I need landlord insurance or can I just tell the kids to insure the contents and property themselves?

Any and all advice appreciated.

davidmcn

Gloster_Wolf said:

can I just tell the kids to insure the contents and property themselves?

That would only make sense if they owned the contents and property. I expect they can insure their own contents, but whoever owns the house is the party who needs to sort out insurance for the building (and whatever contents you've left behind). And "normal" home insurance policies are for your main residence, which is why the insurers are telling you to get something else.

Though you'd need to check that a landlord policy covers you adequately, as it might require the occupiers to actually be tenants rather than just members of your family.

lincroft1710

You own the house but do not occupy it, your children occupy it. Despite no rent passing you are deemed to be a landlord with all landlord's rights (and more importantly) responsibilities in law and your children are now your tenants with all tenant's rights and responsibilities in law.

Your insurer is correct, you need landlord insurance.

theartfullodger

Never rent to (or let stay for free..) friends or family or friends-of-family.

A sure-fire way to ruin relationships & to lose money.

Assist kids to rent elsewhere.. Rent the places you own to normal boring tenants at normal boring market rents.  And get educated as a landlord - e.g NRLA courses.  If you think the time & effort to do that is too much, wait until (no offence) you find out how much ignorance will cost you.

When I started as a landlord I thought I knew what I was doing.  I didn't: Expensive, painful, long-drawn-out, legally difficult mistakes made through my stupidity.  I resolved to learn and get better. Still learning, still making mistakes.

macman

Since there is no consideration paid in return for the right to occupy, there is no tenancy. You have merely granted them a right to occupy. But the property is still yours, therefore it's up to you to insure both buildings and contents, unless it's unfurnished.
Is  the property mortgaged? If so, they need to be informed.

eddddy

macman said:

Is  the property mortgaged? If so, they need to be informed.

Yes - although realistically, the mortgage lender is unlikely to find out, and if they do they'd probably just tell you to stop.

The situation might be far more serious with insurance. If the house burns down, the insurers might ask lots of questions about the occupants etc, and find out that the terms of the policy have been breached. And then refuse to pay out, potentially leaving the OP hundreds of thousands out of pocket.

greatcrested

macman said:

Since there is no consideration paid in return for the right to occupy, there is no tenancy. You have merely granted them a right to occupy. But the property is still yours, therefore it's up to you to insure both buildings and contents, unless it's unfurnished.
Is  the property mortgaged? If so, they need to be informed.

Indeed. The owner should insure. But most (all?) standard buildings insurance policies wil refer to the insured property being 'the home', which will in most (all?) cases be defined as the normal residence of the insured.

Gloster_Wolf

Thanks for the advice everyone. It's greatly appreciated.

I think I'll go ahead with the Landlord Insurance anyway  but I've just read about "Licence to Occupy" so I think there's some more reading to do first.

Hasbeen

Gloster_Wolf said:

Thanks for the advice everyone. It's greatly appreciated.

I think I'll go ahead with the Landlord Insurance anyway  but I've just read about "Licence to Occupy" so I think there's some more reading to do first.

I would try looking at the cashback sites for landlords insurance. "Sometimes" good deals there?

bland

Found this resource which seems to indicate that you may be able to continue with normal house insurance as long as no money (rent) exchanges hands and you let your insurer know the situation (and they agree). It seems your current insurer does not like this set up so either take out their advice of a landlord policy or speak to a different insurer?

My opinion would be as long as you have been honest in who owns the property and who lives there, I would be happy with buildings/contents under either policy (assuming cover provided is the same).

Comms69

macman said:

Since there is no consideration paid in return for the right to occupy, there is no tenancy. You have merely granted them a right to occupy. But the property is still yours, therefore it's up to you to insure both buildings and contents, unless it's unfurnished.
Is  the property mortgaged? If so, they need to be informed.

Broadly i agree, but consideration doesn't have to be direct payment. I wouldn't rule out the tenancy aspect without looking at the details. EG paying ground rent.