Princes Risborough, United Kingdom (PressExposure) October 27, 2009 -- As the rental market flourishes, unfortunately more and more landlords are finding that some tenants cannot pay their rents. The recession and higher unemployment is not helping and so many landlords are considering taking out a Rent Guarantee Insurance policy.
These have been around for a number of years via providers like HomeLet and Letsure. Rent Guarantee Insurance will protect the landlord in the event that their tenant/s fails to pay the rent. Of course most landlords will do their best to ensure that they let their properties to the best possible tenants, but unfortunately it's a fact of life that events happen beyond their control.
If a tenant falls behind on their rental payments it could have serious financial implications for the landlord especially if they have mortgage commitments or other financial income requirements on their property like a pension.
In the first half of 2009 HomeLet paid out over Â£1.5 million in Rent Guarantee Claims and legal costs. It was significantly higher than in 2008 and reiterates the difficulties faced by both landlords and letting agents.
Unemployment is rising at the fastest rate since records began in 1971 and economists are predicting that it could be up to five years after the recession ends before employment returns to stable levels. Taking this into account, it seems clear that rent arrears will only continue to rise as more and more tenants face difficulties in the job market.
In the past week the National Landlords Association has launched the NLA Rent Guarantee Insurance and in September Letsure launched Rentsure Complete Rent guarantee insurance.
Philip Suter of jml-property-insurance.co.uk said âWe had been marketing HomeLet, Endsleigh, Rentguard and Letsure rental guarantee products, however this new popular rent guarantee insurance was not very prominent on our sites so it has been given a complete classification of itâs own.
Landlords are becoming more and more cautious and a lot of letting agents are now offering a Rent Guarantee package as part of their letting programme. A local firm of letting agents that I carry out consultancy work for has just introduced a âManagement Plusâ service. The service includes Guaranteed Rent, Â£25,000 Legal cover for eviction of tenants following non=payment of rent, court costs and 50% of rent paid for up to 2 months after possession whilst the property is being re-marketed.â
Philip went on to say âwe have several other landlord insurance providers who advertise on our sites, who do not offer Rent Guarantee yet, however the trend must be changing. One of these companies has just launched a specialist website to promote their guarantee product within the last 48 hours and this product will shortly be added to those we act as introduction agents for.â
For further information please visit http://www.jml-property-insurance.co.uk/Landlords_Rent_Guarantee_insurance.htm