Well, this is an interesting question so let’s try to answer it….
As a landlord, you are under no legal obligation to insure your property although, if you purchased it with the assistance of a mortgage, the lender may have made it one of the conditions that the building be insured. Nevertheless, surely it would be a sensible idea to make sure that the property is insured.
After all, you will have paid a lot of money for the property and would surely wish to ensure that should it be damaged due to the likes of a fire or flood that it would be covered. If not, where are you going to find the money to repair it or, worse still, rebuild it. Don’t forget that there is likely to be greater risk of the property being damaged with tenants in it as they are less likely to take care of it than you would if you lived in it.
However, it is not just about insuring the bricks and mortar. If you are providing the furnishings and white goods then surely you would want to make sure that they are insured against being damaged or stolen. Again, the cost of replacing one or more of these could be significant.
Another benefit with arranging landlords insurance is that it includes public liability cover. Can you imagine what could happen if one of the tenants or their friends were severely injured whilst in the property and it was deemed to be your fault? They may sue you for a considerable amount of money. Public liability cover would pay out in this situation including meeting the cost of your legal expenses.
Do bear in mind that the cost of insuring a buy-to-let property can be spread by paying the premiums on a monthly basis rather than paying the annual premium all in one go.
So, whilst you may not legally need to insure your buy-to-let property, surely you will agree that it sounds like a sensible idea.