Three scenarios where Rent Guarantee Insurance is vital

As a landlord, do you ever worry about a tenant withholding rent payments or the vacancy period after an eviction?

Rent Guarantee Insurance can be a source of comfort, offering financial protection against unexpected situations. Here, we explore three key scenarios where this type of cover becomes essential.

1. When tenants fall into rent arrears

If you rely on rental income to cover your mortgage and other expenses, how would you manage if your tenant stopped paying their rent? This can be a stressful situation for landlords, leaving you scrambling to cover your costs.

According to figures from deposit alternative provider Reposit, during the first quarter of 2024 average rent arrears claims rose to £1,816 and the percentage of tenants ending their tenancy with unpaid rent reached 18%.

Rent Guarantee provides a safety net in such circumstances, covering missed rent payments for a set period.

With HomeLet’s policies, rent is paid in full for 12 months or up to vacant possession – safeguarding your rental income and financial security in the process.

2. During periods of vacant possession

Missed rent isn't the only concern. What happens when your property sits empty while you find a new tenant? 

These so-called ‘void periods’ can vary according to location. Data collected by Statista between 2020 to 2023 found that average void periods ranged from 12 days in London to 23 days in the West Midlands.

Rental guarantee insurance can cover lost rent during vacancy periods, offering financial breathing room while you find a new tenant.

HomeLet policies cover 75% of the rent for up to three months after vacant possession.

In most cases, this should provide ample financial protection, even during longer-than-average vacancy periods.

Not to mention valuable reassurance and comfort if you rely on your rental income to cover expenses. 

3. When an eviction is necessary

Landlord woes don't stop at rent payments or vacancies. Unfortunately, legal issues can arise during a tenancy.

The BBC recently reported that 30,230 Section 21 notices were served in 2023, compared to 23,622 in 2022. That represents a 28% increase and a seven-year high.

Last year also saw a 49% increase in the number of households that were repossessed by bailiffs after receiving a so-called ‘no-fault eviction’ notice.

Evicting a tenant who repeatedly defaults or breaches the tenancy agreement can be a lengthy process. Thankfully, HomeLet policies provide up to £50,000 of cover towards legal fees associated with an eviction.

This financial cushion can be a source of relief as legal fees can accumulate during ongoing court proceedings.

Rent Guarantee offers peace of mind and financial security for landlords. By protecting yourself against missed rent, vacancies, legal issues, and unexpected events, you can ensure a smoother and more secure rental experience.

Of course, choosing the right policy for your circumstances requires careful planning and research. You should consider factors like cover limits, exclusions, and cost.

HomeLet’s dedicated team of experts is here to assist you every step of the way, providing comprehensive information to make your buying journey as smooth as possible.

HomeLet is a trusted provider of insurance policies for landlords. In 2024, we were awarded a Feefo Platinum award, which means our rating was above 4.5 out of 5 throughout 2023.

We’ve also received a 10 Years of Feefo Trusted Service Award after maintaining a service rating of at least 4.5 for ten consecutive years.

Whether you’re a first-time Buy-to-Let landlord entering the market or an established portfolio investor who needs extra cover to deal with tenants who have fallen into arrears, HomeLet Rent Guarantee Insurance provides essential cover for all landlords.

Protect your investment with policies that cover missed rental payments for up to 12 months, short periods of vacant possession, and up to £50,000 of legal costs for eviction processes.

We put people first here at HomeLet. That means all our rental guarantee insurance policies are backed by expert support.

Whether it be the help of our dedicated in-house Claims team or the on-site advice of legal experts, you’ll always have access to the right people at the right time when you take out insurance with HomeLet.

For more information about our Landlord Rent Guarantee Insurance, contact us on 0800 035 8258 or request a callback. Our offices are open 8:30 to 17:30 Monday to Friday and 9:30 to 13:00 Saturdays.