Introduction

Since landlord insurance is a specialty product, some of the technical terms used in a typical landlord insurance policy may differ from those used in general insurance.  A clear understanding of these technical terms will enable a policyholder or an applicant to know how the policy will function, the conditions of payment and the extent of coverage a property will receive.  Some of the important terms used are:

•    Sum Insured – The sum insured is the total amount of money which the landlord’s building is insured for and is the sum which will be paid out in the event of the complete destruction of the building.

•    Contents Insurance – Contents Insurance is the insurance cover on the contents of the insured property which could include furniture, fittings and upholstery.  Contents insurance could be Full Contents Cover or a Limited Contents Cover, depending on the extent of coverage chosen by the policyholder.

•    Loss of Rent Cover – Loss of Rent Cover is a component of the policy which covers the landlord against any unexpected situations where the tenant ceases to pay rent.  This part of a policy will pay the landlord rent for a period of six to twelve months in the event of a tenant’s default on the rent.

•    Trace and Access Cover – Trace and Access Cover is an extension to a policy which is applicable in the case of oil or water damage.  This covers the cost of tracing the damage to its source.