View Full Version : Insurance Policy - Legal Requirement vs Terms of Business

03-02-2010, 11:15 AM
Hi All

Thank you for reading, i am the tenant:

My letting agency made me sign a form for the admin fee and terms of business that states the following:

"I / We understand that the landlord will not have insurance in place to cover the apartment contents including our possessions. ***Letting Agency Name*** policy is to ask to see proof that you have obtained said insurance before the move in takes place (please see the ‘Insurance’ paragraph below). ***Letting Agency Name*** can assist in providing a quote and arranging this insurance."

The paragraph referenced says:


Your personal possessions must be insured at the property and we must see evidence of this cover before you can sign the Tenancy Agreement.

In addition, the insurance policy you select must provide a minimum of £2,500 cover against accidental damage to the Landlord’s contents and fixtures and fittings. The benefit to you is that the cost of making good at the end of your tenancy could be reduced by the amount you may be able to claim under the insurance. We offer a competitively priced “new for old” Tenant contents insurance policy, with the option of direct debit payment. Our local office can help you with a quotation and to complete an application.

The actual Tenancy agreement only states that is: "strongly recommended" that either the landlord or tenant have extra insurance on contents of the property.

I deduce by the tenancy agreement that is it NOT compulsory to do so.

My landlord sympathizes with me and told the agency that they have insurance on contents (don't think they have accidental damage) and is happy to waiver this requirement but they now insist that because I signed the business terms, as the tenant I must cover my own personal belongings together with accidental damage on the property.

I took out insurance but I have 14 days to cancel it, but before i do this I have the following questions:

My question are:

is it a legal requirement to have the tenant insure own goods and accidental damage towards the property

if i signed the business terms and cancel the insurance, what effect does it have on my tenancy agreement, penalty ect...

if my tenancy agreement does not state that i must have a policy in place, does it superseeds the business terms rendering the business terms irrelevant?

Also as I took out the insurance via the letting agent "competitive" insurer, if i cancel my insurance would it be illegal for the insurer to contact the agency as this would breach privacy laws? As far as I am concerned the contract on the insurance is between me and the insurer.

Thank You

03-02-2010, 16:55 PM
It is not a legal requirement to have tenant's insurance. It is illegal though to have two lots of insurance. Point this out to the letting agent.

03-02-2010, 17:02 PM
Thank you,

The landlord has building and contents covered but not accidental damage or, and now I assume, my personal belongings covered.

It would be useful to know if i incur consequences by not having the personal belongings and accidental damage insurance they stated I am obliged to have in their terms of business.

I walked in the flat with insurance as required and i purchased it via the letting agent, if I cancel it, what can they do? At worst I am in breach of Terms of Business but not of my Tenancy agreement.

03-02-2010, 17:05 PM
I don't think they can do anything, except maybe not give you a reference when you move. As long as you behave yourself the Landlord ought to be willing to do that.

03-02-2010, 17:30 PM
Would u advise the letting agent that I am going to cancel the insurance? Is it worth pointing out that i believe that it is illegal to have two insurances on the same property?

Even if mine covers for accidental damage and personal property they both cover for contents so this is illegal.

I did not know this, I guess I can rest my case :)

03-02-2010, 18:02 PM
It is not a legal requirement to have tenant's insurance. It is illegal though to have two lots of insurance. Point this out to the letting agent.
'Illegal'? Why so?

03-02-2010, 18:14 PM
I was looking online, I read this on wiki answers (how reliable is it!)

”the insurance works on the principle of Indemnity. so in case if you have two insurance policy,you will have to declare to both the insurer, if you don't than it would be a insurance fraud”

Does it sound true? I can have as many as I want but must declare it.

Either way I can't see what can happen to me as a tennant if I cancel my insurance. The tenancy is legal and countersigned by the agency...

03-02-2010, 20:12 PM
Look at the guidelines in the Unfair Terms in Consumer Contract Regulations. A landlord cannot make you insure his stuff against accidental damage as it could be considered to be an onerous or unfair term, but you are liable if you don't choose to have it covered by insurance. It's a judgement call.

Make sure only one policy covers the risk; it's not illegal to have two policies but you might have to claim 50% from both in the event of such and it will become incredibly messy.

03-02-2010, 22:05 PM
More likely: Company1 will deny liability and refer you to Company2. Company2 will then deny liability and refer you back to Company1.

03-02-2010, 22:28 PM
Just to clarify, it is the letting agent that wanted me to take out exta insurance. It is their company policy that tennants must sign up for their own policy.

My landlord thinks I should just cancel the insurance taken out with the letting agent's recomended insurer. l will read the guidelines about Unfair Terms in Consumer Contract Regulations.

I mean I now live in the flat (5 days now) and the contract is signed, what can the letting agent do? They can't void my tenancy agreement can they?

Thank you so much for the help given to me.

03-02-2010, 22:30 PM
What can the letting agent do? They can't void my tenancy agreement can they?
No, chiefly because the Letting Agent is not party to it. Only L and you (T) are.

03-02-2010, 22:42 PM
Also reading the original business terms they made me sign the fact that I understand that the landlord does not have insurance, which is not true.

I think it stinks that they force tenant to sign a pre agreement to the tenancy agreement with business terms that are onerous.

Will contact the agency tomorrow and will let you know how it goes!