Property Owners’ Liability Insurance
For a landlord, property owners’ liability insurance can be obtained as part of your comprehensive landlord insurance or individually if it is the only cover from which you think you can benefit. Although it is designed to financially protect landlords from claims that their property caused physical injury or property damage, it is just as beneficial to tenants who have been hurt and want compensation for their damages.
Covers are usually worth £1 million, and top covers can reach up to £10 million for landlords with more properties, hence more tenants and a higher likelihood of claims against them.
Property Owners’ Liability Insurance
When Might Rental Guarantee Insurance Be Necessary?
- When Physical Injuries Are Sustained
Property owners’ liability insurance claims are most commonly filed when a tenant suffers an accident inside the property. They allege it is the tenant’s fault because they have allowed a broken or unstable structure to remain without repairing it. For example, there are many cases where occupants have slipped on slippery tiles, tripped because of damaged floorboards or fell on uneven stairs. These accidents are minor, but when they have repeatedly caused incidents or caused a significant fall, the tenant may need a medical opinion, for example, if they sprained their ankle or broke their knee.
Another more severe accident is long-term exposure to toxic gases or mould. Although these effects take a while to develop, symptoms of carbon monoxide poisoning include confusion, lethargy and abdominal pain. Likewise, an abundance of mould can cause symptoms similar to a cold, like watery eyes and a dry throat. Medical treatment would be necessary for these, like oxygen therapy for carbon monoxide poisoning or antihistamines for the mould, which with insurance the costs would be covered.
2. When There is Significant Tenant Property Damage
Property owners’ liability also provides coverage against claims that any unpredictable accidents happened inside the building, which destroyed the personal belongings of a tenant or their guests. For example, if a tenant’s friend visited them and drove their car into the garage, but the garage door fell and hit their windscreen and bumper, they may sue the landlord because the faulty fixtures in the property damaged their car. The insurance would then cover the replacement costs and the legal fees, in most cases even if the landlord were found liable.
What Does Property Owners’ Liability Insurance Cover?
1. Medical Expenses
Property owners’ liability means that any insured landlord can file a claim to their insurer after paying the excess. Subsequently, after the evaluation, the injured party would be reimbursed for their medical costs. This could be anything from an assessment to an overnight hospitalization and even further treatment like medication should it be necessary. This gives peace of mind to the tenants, knowing that their expenses will be spared, and the landlord who goes not have to pay these costs.
2. Replacement Costs
When a property is damaged, whether it is furniture, an electronic device or a car, the tenant would be reimbursed by the insurance company for the costs of either repairing a partially damaged object or replacing a destroyed one. Usually, insurance companies have a minimum cost threshold.
Any belongings under this value would not be valid for replacement; however, there is also a maximum limit that depends on the extent of coverage the landlord is insured for. For example, if a shelf that belonged to the landlord collapsed and broke the picture frames that were rested on it, the damage would most likely not exceed the threshold, so the claim would not be valid. Conversely, if a pipe burst and created a flood that caused water damage to all of the tenant’s furniture, the insurance company would be more likely to compensate them.
3. Legal Fees
Sometimes, a tenant may have suffered from a significant injury, mental stress or had a lot of their property destroyed. When this is the case, there is a risk of them taking their landlord to court, and regardless of the verdict, the landlord would need proper representation to aid them in defending themselves.
The insurance company would be responsible for paying the costs of this and sometimes even choosing the lawyer and recompensating the landlord for any fees they may incur due to filing documentation. However, it should be mentioned that often insurance companies are not willing to pay these legal fees unless they believe there is a high chance of the landlord winning the case.
Property Owners’ Liability Insurance – To Conclude
Overall, property owners’ liability can safeguard the insured landlord from the extra expenses associated with claims and assure the affected third party like the tenant that they will be recompensated for their losses.
Find out more about the importance of insurance here.
Other useful links about Business Insurance:
Building Insurance for Landlords
Landlord Contents Insurance
UK General Landlord Insurance
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