Question to landlord: who benefits if a tenant buys an insurance, chooses NDO?

_Anna_

Dear all,

I am renting a flat in Bristol where there a huge shortage of properties on the market. It’s even very difficult to book a viewing (I would say, I needed to make 10-20 phone calls/send emails to book one viewing). Obviously, even if you had already viewed a property and wanted to take it, it’s not clear which applicant will be selected by landlords.

 

Anyway, I viewed a flat and submitted an application to a letting agency where I specified that I chose a traditional deposit rather than a NDO (no deposit option) and I did not want to buy a content insurance. Later, a letting agent called me and told that landlords were more interested in tenants who would choose NDO and buy the content insurance. I need to say that if I had chance to find another flat, I would never agree on this, but as I have already told the situation with flat hunting in Bristol is terrible and I felt that either I had to do what the letting agent suggested or another applicant would get this flat. Therefore, I signed for the NDO membership that I will cancel in 3 months, and I bought an insurance that I will cancel in one month. Totally I wasted 180 GBP.

 

This is what I want to ask now. The letting agent told me several times that the landlords were insisting on NDO and insurance buying. However, I can imagine that the landlords even have never heard about this and it’s a letting agency rather than landlords who benefits when a new tenant buys an insurance. If it’s correct I have a chance to let the landlords know what the agency is doing “on their behalf” (there is their postal address on my contract). Could you (especially if you are a landlord) please clarify this.

 

Thank you.

eddddy

My guess would be that it is the landlord has agreed with the letting agent that all tenants are required to have contents insurance and NDO.

But... the landlord only agreed because the letting agent told the landlord a load of nonsense about what a good idea it is, or the letting agent offered a reduced fee to landlords who agree to this.


(As you probably realise, the letting agent probably earns commission on those products, and so they are likely to be over priced.)

macman

Is this an unfurnished flat? In which case, why would you expect the LL to insure your own belongings?

_Anna_

macman said:

Is this an unfurnished flat? In which case, why would you expect the LL to insure your own belongings?

No, I do not expect that the LL will insure my belongings, but it’s a tenant who has to decide whether to buy an insurance and where to buy. The letting agent suggested me a particular insurance provider.

flower77g

Might be worth flagging to the local authority as a mandatory tenant fee that is not allowed.   It isn't one of the below (Tenant Fees Act).   Especially if it is Bristol City Council as they have been known to enforce this one.

From 1 June 2019, the only payments that landlords or letting agents can charge to tenants in relation to new contracts are:

• rent
• a refundable tenancy deposit capped at no more than 5 weeks’ rent where the total annual rent is less than £50,000, or 6 weeks’ rent where the total annual rent is £50,000 or above
• a refundable holding deposit (to reserve a property) capped at no more than 1 week’s rent
• payments associated with early termination of the tenancy, when requested by the tenant
• payments capped at £50 (or reasonably incurred costs, if higher) for the variation, assignment or novation of a tenancy
• payments in respect of utilities, communication services, TV licence and Council Tax
• a default fee for late payment of rent and replacement of a lost key/security device giving access to the housing, where required under a tenancy agreement

diystarter7

_Anna_ said:

macman said:

Is this an unfurnished flat? In which case, why would you expect the LL to insure your own belongings?

No, I do not expect that the LL will insure my belongings, but it’s a tenant who has to decide whether to buy an insurance and where to buy. The letting agent suggested me a particular insurance provider.

Hi OP
If you are unhappy about something before you even signed the dotted line, please look for another place that meets your criteria.

You cited earlier about how difficult it is to get a viewing never mind a rental.  A friend of ours has a kid at uni in that area and it was diffuclt by the looks of things. Therefore they decided to act, be pro-active and contacted a couple of good LA's and told them they would pay xx percent over the price advertised and guess what, they got the property they wanted the next day.

The above reminds me of when we, my parents moved to London from the north - we got 3k for our detached house and the house prices were around 33k when they started looking but as the markets were rocketing the got gazumped serval times and ended ip paying 40k

I hope you get the place you want that meets your needs and happy there.

Good luck

[Deleted User]

flower77g said:

Might be worth flagging to the local authority as a mandatory tenant fee that is not allowed.   It isn't one of the below (Tenant Fees Act).   Especially if it is Bristol City Council as they have been known to enforce this one.

From 1 June 2019, the only payments that landlords or letting agents can charge to tenants in relation to new contracts are:

• rent
• a refundable tenancy deposit capped at no more than 5 weeks’ rent where the total annual rent is less than £50,000, or 6 weeks’ rent where the total annual rent is £50,000 or above
• a refundable holding deposit (to reserve a property) capped at no more than 1 week’s rent
• payments associated with early termination of the tenancy, when requested by the tenant
• payments capped at £50 (or reasonably incurred costs, if higher) for the variation, assignment or novation of a tenancy
• payments in respect of utilities, communication services, TV licence and Council Tax
• a default fee for late payment of rent and replacement of a lost key/security device giving access to the housing, where required under a tenancy agreement

Perhaps keep this under wraps until near the end of the tenancy as a potential bargaining chip. It may very well be an unlawful fee but I am not sure if raising it as an issue now is best timing.

_Penny_Dreadful

My guess @_Anna_ is the the letting agent is the one making commission from selling both products to the tenant.  Either the landlords are blissfully unaware or they would like tenants to take the NDO insurance so there no possibility of falling foul of the deposit protection requirements although if taking a deposit, protecting it within 30 days and issuing the PI to the tenant is beyond you then...

I'm not sure why landlords would be interested in the tenant's contents insurance, you are quite right that it is down to the tenant to decide whether or not to insure their belongs and which insurance company and policy to choose. 

@flower77g is right to flag the Tenant Fees Act 2019.  Under that Act, landlords and letting agencies cannot require you to enter a contract with a third party for the provision for a service or for insurance or make a loan in connection with a tenancy.  IIRC offering the tenant NDO insurance is permitted but only if the tenant has the option of either paying a deposit or taking the insurance.  You are essentially being told that if you don't take the insurance then you will not get the property which in my opinion, and I will add the caveat that I am not a lawyer, is a breech of the Tenant Fees Act 2019.  As a tenant I would much prefer to pay the deposit rather than take the insurance and as a landlord I prefer to take a deposit and don't offer NDO insurance.  Complying with the deposit protection rules is not onerous and I would rather that than have to deal with an insurance company.

_Anna_

Dear all, the problem with this situation is that the agency does not charge any illegal fees. They suggest to buy an insurance/choose NDO, then they tell to an applicant that the landlords want to have a tenant who will buy an insurance/choose NDO and another applicants have already chosen insurance/NDO.... What an applicant have to do if there is a shortage of properties in the city? Anyway, does anyone know any efficient ways how to deal with this? The letting agent did not break the law formally. 

_Penny_Dreadful

_Anna_ said:

Dear all, the problem with this situation is that the agency does not charge any illegal fees. They suggest to buy an insurance/choose NDO, then they tell to an applicant that the landlords want to have a tenant who will buy an insurance/choose NDO and another applicants have already chosen insurance/NDO.... What an applicant have to do if there is a shortage of properties in the city? Anyway, does anyone know any efficient ways how to deal with this? The letting agent did not break the law formally. 

That is not true, if you are being told that you will only be accepted if you sign up for the NDO insurance that is an illegal fee under the Tenant Fees Act 2019.

As I see it your choices are:

1. Take the insurance, rent the property and then when the time comes to leave and you have moved into your next home, try and make a claim under the Tenant Fees Act 2019 for the repayment of these illegal fees.  Keep any evidence you have of the letting agent saying you won't be accepted without taking the insurance.
   
2. Take the insurance and then as soon as you get the keys and are inside cancel the insurance.
3. Find a landlord who doesn't use a letting agent or insist upon NDO insurance or a landlord who uses a letting agent but a letting agent that isn't one of these !!!!!! insisting you take out these insurance policies.

_Anna_

_Penny_Dreadful said:

That is not true, if you are being told that you will only be accepted if you sign up for the NDO insurance that is an illegal fee under the Tenant Fees Act 2019.

As I see it your choices are:

1. Take the insurance, rent the property and then when the time comes to leave and you have moved into your next home, try and make a claim under the Tenant Fees Act 2019 for the repayment of these illegal fees.  Keep any evidence you have of the letting agent saying you won't be accepted without taking the insurance.
   
2. Take the insurance and then as soon as you get the keys and are inside cancel the insurance.
3. Find a landlord who doesn't use a letting agent or insist upon NDO insurance or a landlord who uses a letting agent but a letting agent that isn't one of these !!!!!! insisting you take out these insurance policies.

Thanks, but I can see problems with all 3 options.

1. I do not have any evidence of what LA was saying (all this was said in personal/phone conversations not in emails or messages). But if there is a chance to prove that LA broke the Law, I will try to do this.
2. This is what I am going to do, but I told in my first post  that it means that 180 GBP will be wasted.
3. If I could choose this option I would choose it without hesitations, but ... (please see my first post).