Landlord rent insurance describes two products that answer completely different risks, and landlords regularly buy one believing they have the other. Loss of rent answers when the building cannot be lived in. Rent guarantee answers when the tenant will not pay. A fire gives you the first; a tenant in arrears gives you the second; and a policy carrying only one of them leaves the other entirely uninsured.
Loss of rent: the building is the problem
Part of the buildings policy, usually included rather than optional. It pays the rent that stops arriving because the property is uninhabitable after an insured event: a fire, a flood, a major escape of water. It is usually expressed as a percentage of the buildings sum insured or as a fixed period, and it often includes the cost of rehousing the tenant where the tenancy obliges you to.
Rent guarantee: the tenant is the problem
A separate, heavily conditional product that pays the rent when a referenced tenant under a proper tenancy stops paying, usually with legal expenses for possession alongside. It requires referencing to a stated standard before the tenancy started, a written tenancy, a protected deposit and the compliance documents served. Skipping any of those is what defeats most claims.
Which one you actually need
Loss of rent you almost certainly already have, and the thing to check is the period and the percentage rather than whether it is there. Rent guarantee is a decision: it is worth it where six months without rent would be a real problem and where you are prepared to run the referencing properly. A landlord with several properties can often self insure the arrears risk across them.
The gap neither of them covers
A void between tenancies is not insured by either. An empty property earns nothing and that is a commercial risk, not an insurable event. Landlords sometimes buy rent guarantee expecting it to cover voids and discover the distinction at the worst moment. The answer to voids is pricing and marketing, not insurance.
Questions people ask about landlord rent insurance
What is the difference between loss of rent and rent guarantee?
Loss of rent pays when the building is uninhabitable after an insured event. Rent guarantee pays when the tenant does not pay. They answer different risks and most landlords need to think about both.
Is loss of rent included as standard?
Usually, as part of the buildings section, expressed as a percentage of the sum insured or a fixed period. Check the period against how long a real rebuild would take.
Does rent insurance cover an empty property?
No. A void between tenancies is a commercial risk and neither product covers it.
What does rent guarantee require of me?
Referencing to the insurer's standard before the tenancy started, a written tenancy, a protected deposit with prescribed information served, and the standard compliance documents. Those conditions are where most claims fail.