Property owners who are considering renting out buildings to residents or businesses should ensure they have adequate cover in place after one case left a proprietor in £100,000 debt.
Total Landlord Insurance has revealed a growing number of landlords are failing to update their property protection levels, as many believe they will be insured as long as they have sought out a policy.
However, this is not always the case. A recent fire claim brought to Total Landlord Insurance for close to £400,000 highlighted the importance of checking up on premium dates.
A blaze that broke out in a block of flats when one resident was cleaning car parts with petrol in the kitchen is likely to leave one property owner up to £100,000 out of pocket after it emerged that the property had been under-insured for a number of years.
For this reason, proprietors who took out policies some time ago have been urged to ensure that their documents are still valid and in-keeping with current market conditions.
In addition, landlords have been invited to seek professional advice on the cost of rebuilding properties if such an event takes place.
It comes after almost 20 per cent of all fire claims settled by Total Landlord Insurance in the last two years were the result of those breaking out in a kitchen, while ten per cent were due to tobacco smoke and five per cent from burning candles.
The results also revealed the remaining blazes were found to have started as a result of electrical faults.
Eddie Hooker, chief executive officer of Total Landlord Insurance, said: "This is a particularly extreme and unusual case but it does highlight the importance of ensuring that your insurance policy is sufficient to cover the full value of rebuilding the property.
"In the current financial climate, it is more crucial to look at the levels of cover rather than the bottom line premium."
It is also vital for landlords to do a fire risk assessment of the property in order to comply with fire regulations and reduce risks.
Landlords have a legal duty to ensure that their rented property is safe from fire. A fire risk assessment form is evidence that you have fulfilled your responsibilities.
Without one, landlords could be open to claims if there was a fire. Landlords of houses in multiple occupation (HMOs) are legally obliged to carry out fire risk assessments.
Lawpack's Fire Risk Assessment Kit can help you to comply with the regulations easily. It includes risk assessment template forms and expert guidance on how to carry out a risk assessment.
Published on: September 18, 2012