Landlords need to do more to protect their investments
- Fire damage continues to be most costly claim for landlords
- Escape of water will affect 1 in 20 landlords each year
- Wilful acts of vandalism and theft accountable for 11% of claims
Landlords are leaving themselves vulnerable to a multitude of risks, according to new research from Alan Boswell Group*, costing the industry millions. Nearly one in three (29%) of all claims made by landlords is for escape of water, while electrical fires do the most damage with an average claim for £53,000.
Fire incidents still account for largest insurance claims
Risk to life is the most important reason to ensure that fire precautions are taken seriously but the risk to financial health should also prompt landlords to improve prevention, detection and tackling fires.
Whilst electrical fire accounted for just 13 claims out of the 2697 claims made by landlords clients of the group in the past twelve months (less than 0.5%), the total cost claimed was a whopping £687,395 giving an average claim value of £52,876 – almost double that of any other claim type.
Along with accidental fire, unknown cause and arson, electrical fires made up the top four places in the list of highest value claims with over £3m worth of claims made last year – 32% of the total value of claims.
Water damage most common reason for insurance claim
With fire being the most costly element it was left to water to be the most prevalent. Flooding and escape of water accounted for over 845 claims. That figure represents over 30% of all claims and was almost 5% of all Alan Boswell Group landlord clients. Indicating that 1 out of every 20 landlords are likely to suffer water related damage in any given year!
Claims were of a lower value however. Flooding averaged over £13,000 per claim, but escape of water averaged £2,400. It is clear that keeping those pipes well lagged makes good commercial sense.
Mother Nature had a hand in a considerable number of other claims. Storm damage generated 470 claims costing nearly £1m, subsidence another £600,000 worth of damage.
But it is often human nature (or lack of) that leaves us feeling most affected. Theft, accidental damage, liability and malicious damage accounted for nearly another 1,000 claims worth nearly £2m.
Health & Safety for Landlords
With nearly £10m in claims made by landlord clients of the company in the past year, Alan Boswell Group are recommending that Landlords stay well ahead of legislation when it comes to health and safety.
“Landlords should not be reacting to changes in the rules. They should be making them.” Said Steve Cox, Account Executive at Alan Boswell Insurance Brokers. “With tougher regulations coming into force later this year making it a legal requirement for landlords to have smoke detectors in their properties we would hope that all landlords are already meeting this basic requirement. Proactively working towards providing the safest environment will make their properties appealing to prospective tenants whilst arguably reducing costs in the long term.
“Being reliant on your landlords’ insurance policy to cover any financial losses is not always guaranteed and, clearly, does not cover any losses to life.”
The company offer a range of Landlords’ Insurance products and have recently won general Supplier of the Year at the annual Landlords & Lettings Awards as well as having three of their Landlord Insurance products rated five-stars by Defaqto, more than any other company.
*Research was carried out by Alan Boswell Group among 21,821 Landlord Client
About Alan Boswell Group
Alan Boswell Group (ABG) is a Top 20 UK Independent Chartered Insurance Brokers* and regional Independent Financial Planners with over 220 staff based across five locations – Norwich, Attleborough, Bury St Edmunds, Peterborough and London. Established in 1982 the company offers a wide range of insurance broking and financial services from landlords’ insurance and self-drive hire to pensions, protection and investment advice. Alan Boswell Group are proud sponsors of NCFC and look after the insurance for the Championship Club.
Alan Boswell product news https://www.alanboswell.com/news/ For an introduction to what we do and how we do it, please click here https://www.alanboswellgroup.com/about-us/ Follow us on twitter: www.twitter.com/abgroup
* Insurance Age Top 100 Independent Brokers 2015