Insurance against being taken for granted

A massive hike in insurance cover sends Victoria Whitlock scurrying on a search of price comparison website

The family will be treated to a meal at my favourite curry house (The Chilli Pickle in Brighton, since you were wondering) this weekend after I saved quite a bit more than the cost of its sublime Mysore Masala Dosa on my landlord insurance.

If you're renting out a property I would urge you to make sure you are adequately insured, but for goodness sake don't automatically renew your policy every year with your existing insurer. If you do, they'll probably rip you off.

Insurance companies don't usually reward their loyal customers with the lowest premiums — they save these for new customers. They assume existing customers will be too lazy to hunt around for the cheapest premium every year.

In my case, they were right. I've been with the same broker for several years, simply because I couldn't be bothered to ring around dozens of competing companies, giving the same information over and over again, for what I imagined would be a saving of a mere pound or two.

However, this year I was shaken out of my inertia when the broker increased my premiums by 50 per cent. I've never made a claim, I'm still renting to the same sorts of tenants and I can't see how their risk has increased, so such a steep rise in the cost was quite frankly ridiculous, I thought. "Would I like to automatically renew?" the broker asked. Not this time, no.

Although landlord insurance is different from ordinary house insurance, in as much as it can include other elements such as public liability cover and loss of rent, it is not any harder to buy and it's not difficult to switch to a new policy if you're not happy with your old one.

You can use price comparison websites like comparethemarket.com or confused.com to find the best premium very quickly, but it is best to try more than one as they each have different deals with different insurers. Some insurance companies don't sell through any of these sites, so it might be worth contacting one or two directly.

Don't just buy on price though — make sure the policy covers everything you need, and make sure you're comparing like with like. In particular, make sure it includes public liability cover and take a look at the excess — the amount of any claim you'll have to cover yourself. I've found these days that most landlord insurance comes with a whopping £500 excess for "escape of water", as this is by far the biggest cause of claims.

Think about whether you want to cover accidental damage, which you might not want to bother with if you've got a meaty deposit from your tenants. Also consider cover for loss of rent, in case your property becomes uninhabitable for a while.

Remember that if your flat is in a block, buildings insurance might already be included in your service charge. And if the property is rented unfurnished you'll only need the minimum contents cover, so make sure you're not being charged for something you don't need.

If you've got more than one property you might be able to save money by putting them all on one policy. Certainly, having only one renewal date will make it easier to manage.

I got several quotes from one of the comparison sites within about 15 minutes. Ironically, the cheapest was from my existing broker! It undercut the renewal offer they had sent me by £65. So there you go. You don't even need to switch insurers to get a better deal, just threaten to leave and let them fight for your loyalty.

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