Not having adequate holiday home insurance could put owners’ investments in jeopardy if anything went wrong, warns independent insurance intermediary, Boshers
Mark Lavington, director of Boshers, says: “Many holiday home owners may unwittingly be relying on normal home insurance cover or, worse, have no cover at all. If you let out your holiday home, you should make sure the insurer is aware, and that all the necessary covers are agreed.”
In addition to protecting the property itself, Mr Lavington recommends that policies also cover at least £2 million for injury to individuals such as guests, customers and tenants to avoid an uninsured compensation claim that could badly damage a property owner’s investment.
“Whether you manage the property yourself or let through an agent,” he says, “it is equally important that you have liability cover. You should also have employer’s liability insurance…A quality holiday home insurance contract should provide employer's liability insurance cover of £10m to protect you against claims made against you in respect of your legal liability for death or injury to such employees.
“Buildings cover is also important. To properly protect your holiday home, you need to cover all buildings against all insurable risks for the full reinstatement cost…Remember, the reinstatement cost is unlikely to be the same as the market value of the property or the price that you paid for it, and is worth proper research. If you under-insure your building, any claim payment may be reduced proportionately, which could involve a significant loss to you.”
He continues to say that with the rising number of properties that provide luxuries such as state-of-the-art entertainment systems and hot tubs, contents insurance is also a valuable investment, and holiday home owners can protect the income provided by the property with loss of rental income cover. He also reminds owners that it is important to inform mortgage provider that the property is being used as a business, or it could affect the validity of their insurance policy.
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