Insuring your property for rental
If you’re planning on renting property in the long-term to tenants who may be resident for years or to tourists for shorter periods, the best policy is to be comprehensively insured to cover the risks of rentals
Anyone who owns a property should have some insurance to protect it, themselves and others in case of risk. While it’s impossible to foresee every eventuality, properties that are rented for long or short periods may give rise to additional risks that landlords, owners and managers are well advised to consider and be covered for.
We asked Danni Worth, one of the founders and partners in Marbella-based Op de Beeck & Worth Insurance, for expert advice on what kind of coverage property owners and landlords should have, just in case.
Long-term rentals
The most basic coverage should obviously protect the owners’ investment in the property per se, Danni says, as well as covering contents. But landlords should also ensure that liability is extended to cover tenants, so it is vital the insurer is made aware that a property is being rented. At the same time, in the terms of the contract, it is a good idea to make sure the tenant is responsible for insuring their own contents and personal effects.
Landlords may also want to add coverage to their policy to protect against additional risks that can occur when properties are rented, Danni explains. These include: potential loss of income as a result of non-payment of rent or damage to the property caused by a third party that requires you rehouse a tenant at your own cost; any damage to the property and contents caused by tenants; and provision for legal defence, in case you and the tenant enter into a dispute.
Short-term rentals
For landlords who plan to rent their property to tenants for short-term periods, and particularly when properties are being used for tourist accommodation, Danni recommends taking out the same kind of comprehensive insurance coverage as you would for long-term rentals. But, he notes, in the case of properties rented under short-term and holiday rental contracts, insurers typically do not cover loss of rental income deriving from non-payment nor will you be able to arrange coverage for legal defence costs that could arise from problems caused by or with short-term tenants.
At Terra Meridiana, we use Op de Beeck & Worth Insurance for our personal needs and regularly refer clients to the firm to cover all kinds of risks, from household to vehicle to health insurance. If you would like a quote for your property and belongings, you can reach Danni Worth via email at: danni@opdebeeck-worth.com or call: +34 952 88 22 73.
