Landlord Insurance for Malicious Damage

Top 10 Considerations When Buying Landlord Insurance With Malicious Damage Cover

Malicious damage protection is an optional add-on for landlord insurance policies. It covers vandalism, intentional damage, or theft by tenants.

While providing helpful peace of mind, malicious damage cover comes with caveats.

Here are 10 key factors for landlords to consider:

1. Common Malicious Damage Scenarios

Typical malicious incidents include smashed windows, graffitied walls, damaged doors, broken fixtures or stolen appliances. Inventory lists and photos evidencing the damage help claims. Theft of landlord contents like white goods is also covered if forceful entry is proven. Understanding common scenarios helps set realistic expectations.

2. Policy Excesses

Most insurers impose an increased policy excess for malicious damage claims, often £500-£1000. Review if you can afford these excess levels if a claim is needed. Higher excesses bring down the premium but increase your own payout per claim.

3. Tenancy Type Limitations

Malicious damage cover may be restricted to certain tenancy types, like excluded occupiers or tenants without Assured Shorthold Tenancy agreements. This can exclude lodgers or subletters. Check who is classified as a “tenant” under your policy wording.

4. Protection for Outbuildings

Outbuildings like garages and sheds may not be included under standard buildings cover.

Check malicious damage includes these structures too. Contents kept in outbuildings may also need specifying separately on the policy.

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5. Cover Limits

Check for any limits on malicious damage cover regarding value per claim or in total per year. Restrictions like £2,500 per claim or £5,000 annually can be expected. Know the limits to avoid underinsuring.

6. Lock Replacement

If keys are stolen, and locks must be replaced to secure the property, this may not be included automatically. Some insurers provide lock replacement following theft up to £500-£1,000. But check your policy documents for clarity.

7. Distinguishing Damage Types

With accidental damage versus malicious damage, insurers may dispute which claim type applies. For example, determining culpability can be tricky if a kitchen sink is blocked and floods a property. Only malicious damage is covered.

8. Evidence Requirements

Insurers will require police reports as evidence for significant malicious damage claims. They may also reject claims where malicious intent can’t be firmly proven. Keeping a detailed inventory also helps demonstrate missing or damaged items.

9. Tenant Referencing Standards

Most insurers require tenant referencing checks like credit checks and references from previous landlords before providing valid cover. Ensure referencing procedures meet the insurer’s standards.

10. Unoccupied Period Exclusions

Standard policies exclude cover when properties are empty for 30+ days. Malicious damage cover may also be restricted during vacant periods between tenancies. Unoccupied property insurance is needed to plug this gap.

Scrutinising policy terms for malicious damage gives landlords clarity on claim scenarios. While added protection, limitations apply, so it’s not a catch-all safeguard. Proper tenant vetting and referencing remain key to mitigating malicious damage risks.