Landlords are being warned not to make claims for small amounts on their let property insurance, with an expert claiming that the loss of a no claims discount (NCD) could see future premiums hiked.
Richard Burgess, director at let property insurance specialists Cover4LetProperty, says a claim could see the cost of an annual landlord policy go up by 20%.
“Certainly with our policies – and with some of those offered by other providers too – a 20% NCD is automatically deducted from the cost of the annual premiums, so that landlords get cost-effective, affordable cover,” he says, “Of course, should a successful claim be made on a policy, then at renewal, the new cost will not include the no claims discount – meaning the premiums will appear to increase quite dramatically.”
Burgess gives an example of a landlord who makes a small claim for £200. As the policy has a £100 excess he receives £100 from the insurer when the claim is approved.
But at renewal time the landlord will typically find that the cost of their cover has increased by around 20% – maybe more. With the average annual premium amount being £208, this means that they will pay £249.60. After that, they will need to rebuild their no claims discount back up over the years.
He says: “In the long run, landlords could end up paying out a lot more for the cost of their cover than if they had not claimed for a small amount. We suggest that in the event of a claim, in the first instance you contact your broker for advice, as that is what we are here for.”
Landlords are being warned not to make claims for small amounts on their let property insurance, with an expert claiming that the loss of a no claims discount (NCD) could see future premiums hiked.
Richard Burgess, director at let property insurance specialists Cover4LetProperty, says a claim could see the cost of an annual landlord policy go up by 20%.
“Certainly with our policies – and with some of those offered by other providers too – a 20% NCD is automatically deducted from the cost of the annual premiums, so that landlords get cost-effective, affordable cover,” he says, “Of course, should a successful claim be made on a policy, then at renewal, the new cost will not include the no claims discount – meaning the premiums will appear to increase quite dramatically.”
Burgess gives an example of a landlord who makes a small claim for £200. As the policy has a £100 excess he receives £100 from the insurer when the claim is approved.
But at renewal time the landlord will typically find that the cost of their cover has increased by around 20% – maybe more. With the average annual premium amount being £208, this means that they will pay £249.60. After that, they will need to rebuild their no claims discount back up over the years.
He says: “In the long run, landlords could end up paying out a lot more for the cost of their cover than if they had not claimed for a small amount. We suggest that in the event of a claim, in the first instance you contact your broker for advice, as that is what we are here for.”
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