NLA combats arrears with rent guarantee insurance

Permalink: NLA combats arrears with rent guarantee insurance
by Gill Montia

Research from the National Landlords’ Association (NLA) indicates that almost three quarters of private residential landlords have experienced rent arrears, with 43% of this group reporting arrears being incurred in the last 12 months.

To offset this risk, the NLA has launched rent guarantee insurance with a policy that includes legal expenses cover and a dedicated 24-hour advisory service.

The new offering is available to all UK residential property landlords.

NLA chairman, David Salusbury, comments: “Landlords may not realise they can protect themselves against rental arrears, but our research clearly shows there is a need to safeguard your rental income.”

He adds: “Unfortunately we aren’t out the woods with the economy just yet, and thanks to redundancy and unemployment some tenants are struggling to pay their rent.”

Mr Salusbury also reminds landlords of the importance of taking full references at the outset of a tenancy, and keeping in touch with tenants, to minimise the risk of a serious arrears problem.

In related news, the Work and Pensions Committee of the House of Commons has announced that it is undertaking an inquiry into Local Housing Allowance.

The allowance was introduced for new tenancies last year, replacing Housing Benefit, and is paid to the tenant rather than the landlord.

Critics claim that it is responsible for a rise in arrears as some claimants allow their rent money to be swallowed up by general living expenses.

Landlords can apply to have the allowance paid direct but only when tenant arrears hit eight weeks.