Are any of your buy to let properties in a flood risk area? If they are, you may find you are soon stuck with properties that are uninsurable and therefore virtually impossible to sell as an agreement made between the government and the insurance companies twelve years ago is about to come to an end (June 2013).
This agreement forced insurance companies to provide cover for properties on flood plains, so even those with properties in high-risk areas susceptible to regular flooding were able to enjoy the protection of insurance against flood damage. But now that this agreement is coming to an end, all bets are off and the insurance companies are no longer obliged to provide cover.
As a result, industry experts predict that more than 200,000 property owners will be left without the protection of flood damage insurance, and if this applies to you, it means your tenants will not be able to secure contents insurance and you won?t be protected by buildings insurance. And if the worst does happen and the nearby river bursts its banks in heavy rain, your property could become uninhabitable for months, or worse still, so badly damaged that repairs are unaffordable.
Of course if you are looking to add to your portfolio, you can check whether a property is located in a high-risk flood area via maps on the Environment Agency website?areas of particular interest are Yorkshire, Nottinghamshire, Kent, Devon and Worcestershire. After all, there is little point in investing in a new buy to let property if you subsequently discover you can?t insure it!
This article is provided by?Property Portfolio Software, the UKs leading?landlord software and?property management software provider.
Source: http://www.landlordsyndicate.com/news/changes-to-flood-insurance/
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