How to Get Value For Money From Your Buy To Let Insurance
When you take out a buy to let insurance policy, you need to be thinking about value. Every good landlord knows that renting out a property is an investment. Often the money on investments is made because people maximized their opportunities at the margins. Every pound that you can save on your policy is a money you can use to reinvest in another property. So that begs the ultimate question – just how can you get value for the money from your buy to let insurance policy? Here are some ways to maximise value:
Insure the property’s value, not its rebuild cost
There is often a significant difference between a home’s rebuild cost and its true value. The value is much more than the rebuild cost for one reason or another. One big mistake that people make is in listing the rebuild cost as their insured sum. These people are not getting the most out of their insurance and they are costing themselves money over the long run.
Combining multiple properties under one umbrella policy
If you have a number of commercial interests, you can combine your properties into one buy to let home insurance policy. This is good for both your management needs and for maximising value. A smart landlord will negotiate a better price by combining policies with all of his or her properties. Though it is hard to say how much money you will save with this method, it’s a good bet that you’ll save some. As mentioned before, profits are all made in the margins, so this is important.
Choosing your clientele carefully
It is not always possible to choose clientele delicately, but it’s something you need to do. If you rent to professionals, then your insurance for buy to let rates will be lower. That’s because these people are less likely to destroy your home and to miss rent payments. If possible, do plenty of background research on the people you rent to. They can help make or break your policy rate. A good tenant can save you hundreds of dollars over the course of a year.
Including a policy excess
If you have the financial flexibility to do so, it might make sense to include a substantial policy excess. This can bring down your monthly rates and shift the risk a little bit. This is only a good option for people with the financial means to make the excess payment in the event it becomes necessary, but it is something to think about if you want a well-insured property for a lower cost.
These things can all help you get value for your money when shopping for buy to let insurance. It pays to be frugal and to care about the margins when you invest, so look into these methods for increasing your take each month. Pop over to our quick guide on how to choose a buy to let policy. We cover:
- Is a specialty provider the way to go?
- How much coverage do I need?
- Demand certain guarantees along with your policy
