Rent guarantee insurance

You cannot purchase Rent Guarantee as a stand alone policy. Rent Guarantee is part of our Legal Expenses cover - an optional feature that can be added to our Landlord Insurance for an extra layer of protection.

If you are already a Landlord Insurance customer, you can take out Legal Expenses cover at the point of renewal, and add Rent Guarantee then.

If you are a new customer, you will need to take out Legal Expenses cover at the point of obtaining our Landlord Insurance. You will then be able to add Rent Guarantee.

Legal Expenses covers the legal costs and expenses you face when dealing with disputes related to renting out your property. We can pay out up to £250,000 per claim.

We cover:

• Employment disputes and compensation awards
• Legal defence
• Property protection
• Contract disputes - excludes contract disputes with your tenants
• Debt recovery
• Statutory licence appeal
• Personal injury
• Tax protection
• Repossession
• Dilapidations and maintenance
• Eviction of squatters
• Rent recovery - covers the legal expenses involved in legally pursuing unpaid rent, not the unpaid rent itself

Your property must be residential and in the UK. You need to have a satisfactory reference for each tenant and each guarantor from a referencing service before the tenancy begins. It must include:

1. A written reference from the previous managing agent or landlord
2. A written reference from an employer (or other financial source)
3. A credit history check that includes the Enforcement of Judgments Office, County Court Judgments and bankruptcy

You must keep clear and up-to-date rental records and the property needs to be let using one of the following contracts:

1. an assured shorthold tenancy or assured tenancy under the Housing Act 1988; or
2. a standard contract under the renting Homes (Wales) Act 2016; or
3. an assured tenancy or short assured tenancy under the Housing (Scotland) Act 1988; or
4. a private residential tenancy under the Private Housing (Tenancies) (Scotland) Act 2016; or
5. a private residential tenancy to which the Private Tenancies (Northern Ireland) Order 2006

The policy wording has the full terms and conditions, but the following key circumstances aren't covered:

• Rent arrears for any residential premises not in the UK
• Rent arrears is not available for properties in the Isle of Man or Channel Islands
• Rent arrears if you do not have satisfactory references before the tenancy starts
• Rent arrears where you are not seeking possession of the property

Unless equivalent legal expenses insurance was continuously in force immediately prior to the start of our Rent Guarantee cover, claims for Rent arrears within 90 days of the first period of Rent Guarantee cover where the tenancy agreement started before the start of the Rent Guarantee insurance would not be covered.

Rent arrears if the property is not let under a specific letting agreement defined by the Housing Act 1988 or the renting Homes (Wales) Act 2016 or the Housing (Scotland) Act 1988 or the Private Housing (Tenancies) (Scotland) Act 2016 or the Private Tenancies (Northern Ireland) Order 2006.

We will not pay any claim for rent arrears which accrue during a period where any legislation, government or court guidance, court system or court rules result in:

1. any part of the possession proceedings relating to the let property being halted or delayed; or where
2. any court action for possession of the let property is prevented from being started

We will not pay:

• Any rent arrears or rent deferred prior to the start date of this section of cover, and any reduction in rent agreed at any time
• Rent arrears claims exceeding 12 months
• Rent arrears reported later than 90 days after the date of the rent not being paid when expected
• Rent arrears for commercial, mixed use premises, Holiday Homes or Short Term Lets
• Rent arrears once the property is re-let

Dealing with late or non-payment of rent can be stressful, especially if you rely on that income for your own bills and monthly mortgage payments. Before you decide to serve an eviction notice and make a claim on your rent guarantee insurance, there are a number of steps you may want to consider to help get things back on track.

If you haven't done so already, have the conversation with your tenants to find out what the issue could be? The tenants might have hit short term financial difficulties where you can try to work together to come up with a payment plan for reclaiming most or all of the unpaid rent. For good and reliable tenants, you might consider being flexible. If the financial difficulties are long-term and the tenant is unwilling to co-operate, it might be best to break the contract and seek new tenants.

There are some helpful sources you can suggest for tenants experiencing financial difficulties, including the Money Advice Service's Money Navigator Tool and the Business Debtline for free and impartial money advice.

If you have legal expenses insurance, you will also have access to DAS Businesslaw where you can find helpful guides on what to do if your tenants aren't paying their rent, as well as a useful payment plan template.

DAS Businesslaw also contains a number of other useful templates and guides for landlords, including:

• Tenancy agreements
• Contracts
• Section notices
• Tenant payment reminders
• Rent increase notices
• Health and safety audits
• Guides on deposits, disputes and guarantors

For more information on how to register for DAS Businesslaw, please see your legal expenses insurance policy documents for your unique access code.

Once the tenant has not paid rent for 30 days and the relevant Section 21 or Section 8 notice has been issued, then you can claim.

You must inform our legal expenses cover provider DAS as soon as possible. The claims handler then will inform you within five working days whether the claim is covered or if more information is needed.

If the claim is covered, you'll be provided the details of the solicitor assigned to your case and what to expect next. Any claims reported after 90 days after the date of the rent not being paid when expected is not covered.

Examples of some of the documents we need when you claim:

• A copy of the tenancy agreement
• A schedule of how much rent is owed
• Copies of any references you have
• Any emails, faxes or letters sent to do with the dispute
• If it's applicable to the claim, then a copy of dilapidations inventory and/or schedule of dilapidations - this details breaches of the lease that are to do with the condition of a property during the tenancy or when the leases ends
• Copy of any notices for possession - usually this will be a Section 8 or Section 21
• Confirmation of your Direct Line for business policy schedule
• A deposit protection Certificate
• Proof of ownership of the property

Find out more about the eviction process.