As the credit crisis sets in, over a third of Brits admit they would now seriously consider renting out part of their home if their financial situation gets more difficult.
However, new research from AA Insurance reveals that up to three million homeowners who have chosen this route could in fact have an invalid home insurance policy because they’ve failed to notify their insurer.
Nearly half of those surveyed admitted they weren’t aware of the need to check their policy. For example, insurers regard lodgers as being an additional risk in terms of potential for thefts and damage to the home and therefore need to know. Special terms or restrictions may be included in a home insurance policy to reflect the presence of someone renting.
The lack of understanding is so significant that three quarters (73.53 percent) of the UK population said they were unaware that their belongings will almost certainly not be protected if they are stolen by a lodger.
Simon Douglas, director of AA Insurance, explains: “More people are becoming lodgers and landlords because of the current financial situation. We are urging all landlords or landladies to check their insurance policy before any new lodgers move in.
The person renting out part of a house may also overlook checking whether they are insured in their new residence. The findings reveal that eight out of 10 (79.74 percent) did not ask whether their personal items would be covered by their landlord’s insurance.
