Landlords are being urged to ensure they have appropriate cover to protect themselves in the event of tenants not paying their rent.
The National Landlords Association (NLA) has issued the call following their survey of 1,019 landlords. Results of the survey show that 38% of landlords have experienced rent arrears during the past 12 months. On average, non-paying tenants owed landlords £1,943.
Surprisingly, the findings show that a huge 89% of landlords had no insurance policy that would cover them in the event of rent arrears. Only 23% of landlords questioned said that they take out loss of rent cover.
Rental income risks
These statistics have led for the NLA to encourage landlords to take out a rent arrears insurance policy. Many of these policies cover landlords not only against the non-payment of rent but also any legal fees necessary to recover monies.
Chairman of the NLA, Carolyn Uphill urged landlords to take out sufficient cover to help themselves in the future. Uphill remarked that “most landlords will be affected by rent arrears at some point” due to “many different reasons why tenants could find themselves with difficulties over meeting their rental obligations.”
She went on to say: “It’s important to be prepared as the amount of money lost through arrears can roll into tens of thousands of pounds.” Uphill then pointed out that the act of recovering unpaid monies as “a very stressful and costly process.”
As a final comment, Uphill said that she would “advise all landlords to take out specialist rental arrears cover” to give “peace of mind.” She says that taking out this type of cover can also guarantee “legal advice and specialist lawyers to assist in the recovery of any lost monies.”