Hi, i’m a new landlord and new to open rent having recently put my property up for rent. I have two prospective tenants that have passed the credit checks but with the proviso ‘proceed with caution’. This i believe is because the affordability is tight. I have been offered rent guarantee insurance through open rent which seems good for £207 a year but i have very little faith in insurance companies so wondered if anyone on here has successfully claimed unpaid rent using it. There seem to be quite a few loopholes in the policy wording.
what loophole are you referring? to me it is a very weak insurance, might as well look elsewhere to compare.
for example you need i think 3 months that they are paying, which is fine. but then the insurance last for whichever is shorter AST or 12 month. so that means if court takes 6 months and 6 months not paying. then really you have 3 months of real full insurance cover.
for example for month 11 your tenant not paying then they will only cover 1 month as the terms and condition is covering 12 months only.
or you started mid of your 12 months AST then you only get 3 months rent covered max if they start not paying at the same spot 3 months.
given all the probability of all those happening the chances are rare. I am not saying chances of not paying is rare but the chance if they are not paying during that little window.
Thank you. The main loophole i was referring to was a recurrence of the phrase ‘reasonable chance of success’. I wasnt really clear what this means but it seems like they could easily decide not to pay based on this. The cover you described does look weak. Do you know of any good products on the market?
You will need to look for yourself, i don’t have an insurance. but the key question is, are we looking for the red herring. It is all about chances, but at the end of the day it is your own judgement that matters when you pick someone.
It is all a gamble.
Because if you got insurance, then it will be lazier on your side and if someone has the bear minimum bad tenant which can pass you would take it and the guarantee covers it. Problem comes when they say don’t feel like paying you. They are company making money after all.
I think i need to contact the insurance company. Id be really surprised if he cover ends at 12 months. It would seem logical that as long as the claim happens between month 4 and 12 then the rent cover should be ongoing until theyre evicted otherwise this cover isnt worth having.
I see. Im not sure that the one they currently offer is rentguard as i think they stopped offering that during the pandemic. This is a third party insurance so ill call them today to check the points you’ve raised. Thanks again for ypur input on this.
So i heard back from the insurance company and they say that the rent guarantee insurance would pay out up to the point the tenants were evicted, or £50,000 was reached as long as the policy hadnt expired before the tenants stopped paying. It seems to have improved since you spoke to them.
Are you sure? e.g. does it say on the terms and conditions and also calling them? their customer service wasn’t so good when i called, full of office laughter and not answered properly and only got it right the second time with some mixed messages.
I’m trying to make a claim atm and it’s been nearly a month. A month of tenants not paying and coming upto a month in trying to claim.
They clearly state 365 days 24hr legal helpline. You get put through to call care which is a call centre no legal advice line. Which is not true. You can’t speak to a solicitor. If I was you I’d stay well away from it. I’m looking at another company for another policy