A holiday let is a property that you own but let out to holidaymakers. It might be furnished, or unfurnished, in the UK or abroad, and could be constantly occupied, or mostly empty. Whatever the type of property, you can protect it with holiday let insurance which will cover it for damage, fire and theft, whether caused by yourself, or someone you might rent the property out to or allow to stay there.
You may have purchased the property with an initial plan to use it regularly, perhaps for yourself and your family and friends. You may have thought you would not let it out and do all of the management, cleaning and maintenance required yourself. If your situation changes and you decide to make some extra income from renting the property out to other holidaymakers, you want to be sure your holiday property is covered.
You are allowed to stay in your own property when it is covered by holiday let insurance. It is common for holiday let owners to stay in their property, in between customer bookings.
If your property is likely to be unoccupied for a length of time, or you only use your property as a second home then your insurance requirements are likely to be different.
If your property is abroad, you have the option of insuring the property through an insurer based in that country or via one in the UK.
If you choose to use a local insurer, there may be language barriers and the policy may be more difficult to understand. What’s more the claims process may be different to a British policy, and you will be operating under a foreign legal system and financial services regulation.
You have the option of instead taking out a policy from a UK-based insurer for additional peace of mind. This way, the policy will be in English and you may find that the claims process is similar to navigate and understand should you need to make a claim.
A good comprehensive holiday property insurance will cover the structure of the building, damage to its contents, theft and in some cases, loss of rental income.
Building and contents This part of the insurance covers the main structure of the building and fixtures and fittings of your holiday home. If the property is furnished it will also cover things like appliances, and furniture, including soft furnishings.
Accidental damage: This covers damage to fixtures and fittings. Especially on holidays, damage can happen to your property as people unwind and enjoy themselves. Paying short-term guests may not be nearly as careful with your property as you are. Whether you cause it, or someone renting the property causes damage, holiday let insurance can cover the damage.
Theft: Some policies will include theft from paying guests, though this varies from policy to policy so don’t forget to check the small print and terms and conditions if this particular part of the holiday let insurance is important to you.
Unoccupied periods: If your property remains empty for long periods, you can choose an insurance policy that covers the property for periods longer than 30 or 60 days.
Loss of rental income: If you cannot rent the property because of an event like fire or flood, and suffer a loss of rental income, some specialised holiday home insurance policies will cover this shortfall in income.
Emergency travel cover: If there is an emergency at the property and you have to travel to the property to sort it out, holiday let insurance can cover these costs.
If you are letting a property, especially abroad, others will be on the property more frequently than yourself. If guests or people you employ to manage or maintain the property are injured on the property, you will be covered under a holiday let insurance policy with liability insurance.
This will cover anyone visiting or staying on the property, whether it is friends, relatives, or paying guests.
It is a good idea to have insurance cover for your holiday home, as you will have a lot of different people staying and they will be unfamiliar with the property. They may accidentally break or damage goods in the house, including appliances and fixtures or fittings, either because they are unfamiliar with how they work, or perhaps because they have been more careless than you might have been with your own property.
You will also be covered if anyone injures themselves while they are staying in your property – for example slipping on steps or paving stones, or having an accident in the house.
If you have a permanent tenant year-round, consider landlord insurance instead of holiday let insurance. This will cover slightly different risks.
Am I legally required to insure my holiday let?
No, but it may be a condition of the mortgage you have for the property that the property is insured at all times. You may feel more comfortable knowing the property is fully insured, if you are not visiting the property regularly.
This is particularly the case if you live a long way from the property and it is being managed or let by an agent who may not always inform you of damage or issues on a regular basis.
Can I just use a normal home insurance policy for my holiday let?
If tenants or staff are attending to the property in your absence you should cover them with the liability insurance which is included in a holiday let insurance policy. This will protect you, and them. A standard home insurance policy may also exclude renting the property on a commercial basis.
Does my holiday let property have to be based in the UK to insure it?
No, most insurers will cover European locations that have proven popular for British holidaymakers to own properties in, like Spain and Portugal.
Can I insure the property if it is empty?
Different policies will allow different periods of time the property can remain unoccupied. You can choose a policy based on how long you anticipate these periods will be during the life of the policy.
The most important thing is to be honest with your insurer and let them know if your property is going to be empty.
How often do I have to visit the property?
There’s no obligation to personally spend time in the property for most policies. Some owners may let their property full-time, and never visit it during the period of the policy.
Is a holiday let more likely to be broken into than my primary residence?
This will depend on the location of both properties. One thing to keep in mind is that if your holiday let is regularly empty, this poses a security risk. You could improve the security of your property with additional locks on doors and windows and consider an alarm system to deter intruders.
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