If you own or manage a House in Multiple Occupation (HMO), you will be aware of just how difficult it can be to find HMO Insurance.
As a Landlord insurance broker specialising in multiple occupancy properties, we are often asked why mainstream insurers are so reticent to cover HMO's, in truth, the answer is, that they simply present more risk of a claim.
However, by understanding the potential problems and minimising risk, it is possible to significantly reduce claims volumes and in turn, reduce your premium.
Here are five of the most common HMO Property Insurance claims:
According to national fire statistics, you are six times more likely to die in a fire if you live in a House in Multiple Occupation (HMO) as opposed to a single-family house.
This risk increases to a staggering sixteen times more if the HMO is 3 or more storeys high.
Many factors impact these numbers from multiple cooking and heating sources, smoking in bed, blocked fire exits, higher levels of vulnerable tenants etc.
Factors that present an immediately reduced risk:
- No cooking facilities in rooms
- No Smoking policy
- Purpose-built HMO’s with concrete rather than wooden flooring
- Fire protection systems & escape systems
- A regular schedule of fire and gas inspections (Including the HMO APP provided with all Insync HMO Insurance policies)
#2 Water Damage
Multiple tenants create multiple risks of water damage claims due to the higher number of bathrooms and water sources.
Typical claims include system leaks, burst pipes, and overfilled baths or sinks.
Inspecting and maintaining bathrooms, heating and kitchen facilities regularly is the simplest way to reduce risk.
Pressure cut-off valves are also available which will automatically cut off supply and provide an alert in the event of a water leak.
Damage to doors, locks and windows is also typical across HMO properties. Smaller losses are often handled directly by the Landlord without involving their insurers; however, they still represent a direct cost and an impact on your investment return.
Much of the risk here can be reduced by carefully managing and vetting tenants. Still, we would also recommend a vigilant policy as to the primary front door access as an excellent first line of defence.
#4 Malicious Damage
Whether it’s a brick through a window or graffiti over the walls, malicious damage claims can be costly to repair.
You should also check your HMO Landlord Insurance carefully to ascertain whether it extends to include malicious damage by tenants.
If this extension is not in place, any damage caused directly by tenants will not be covered, such as punched holes in doors or walls, which could leave you with an expensive repair bill!
#5 Property Owners Liability
Liability cover for property owners provides indemnity for the Landlords legal liabilities owed to tenants, or members of the public, following injury or damage to their property.
Any property owner owes a duty of care to protect their tenants, but in the case of HMO’s, the licencing and legal requirements make matters even more apparent.
Example claims for Property Owners Liability include:
- A tenant falling down the stairs on a loose carpet tile
- Tenants health problems brought on my black mould
- Cuts to legs and arms from a derelict greenhouse in the garden
Specialist HMO Landlord Insurance with FREE HMOSafe Audit Inspection APP
The APP allows easy on-site monitoring of fire and gas safety to ensure you comply with local authority requirements.
You can get obtain an HMO Property Quote online, or why not book a Landlord Insurance review with one of our Property Insurance Gurus, who can provide expert advice to ensure you have everything covered!