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Under-insurance a massive problem for landlords - claim

Landlords have been told they face another invisible threat beyond Coronavirus - it’s under-insurance, which is apparently rife in the private rental sector.

Data from RebuildCostASSESSMENT, a web-based insurer, reveals what it calls ”a massive shortfall in cover among rented homes and business properties.” 

The insurance valuation provider estimates privately rented homes in Britain could be under-insured by a whopping £315 billion, while for UK commercial property, the underinsurance total is around £325 billion.


“What this means is buildings across the country are woefully under-protected in the event of any kind of damage” claims the firm’s director, James Scott-Brown  

“I fear that in the current financial climate many property owners simply would not survive the consequences of underinsurance” he adds.

His firm estimates that overall some 79 per cent of property in the UK is under-insured, typically insured for an average of 69 per cent of their worth.

On the other side of the coin, some 14 per cent are apparently over-insured - and heftily so, at an average 121 per cent.

For the private rental sector, the company estimates the total under-insurance is some £315 billion.



“We’ve recently seen with the situation around business interruption cover that insurance contracts can lead to confusion. Under-insurance often leads to disputes with insurers” says Scott-Brown.

“Now is not the time for anyone to discover their insurance policy won’t pay out the amount they’re expecting. This is a UK wide problem and it can only be resolved by property owners realising the risk they’re running and then making sure their buildings are insured for the right amount.”

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    'Under-insurance a massive problem for landlords - claim' is the result of research by - surprise, surprise - an insurance company. Could Landlord Today please stop giving us stories of 'research results' by the very companies that will profit from those results? How about independent research results? (If I were a window cleaner, I'd probably go looking for results that claim to show people's windows are too unclean and them publicise that .........). Just stop this please, Landlord Today.

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    I'm glad that this has come up. I made a claim on a garden wall being blown over in strong winds, will not go into details but the neighbour lowering her garden next door had not helped this situation.
    Needless to say insurance company agreed that I was covered ,but I then found out that I was under insured on my house which meant that they would only pay 70% of my claim.
    I asked them to prove this. I went through demolition costs and build costs on my whole property and explained that my property was functional and not bespoke. In other words normal kitchen, not granite work tops or gold plated taps etc, same for the rest of the house.
    Eventually they had to agree that the house was adequately insured and fully paid for the cost of the replacement wall.
    Remember this is a business and as such they will try and undercut you and this is seen as good business for them.
    Therefore if you don't like what they inform you challenge it!


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