Lodger Insurance- Obtain cover for your Buildings and Contents

You may find that following a change in circumstances, you have house room to take in a lodger.The reasons for doing so vary, sometimes perhaps when the family have left home you do so for the added company or as more and more people are now doing, to provide an additional income. Under the government “Rent a Room” scheme, you can currently earn £4,250 tax free by taking in a lodger, providing the room is furnished for habitation. Of course there are insurance implications of taking in a lodger and the presence of a non-family member in your home is a material fact that needs to be declared to insurers. Failure to do so may invalidate your insurance policy.

At Assetsure, we are happy to provide insurance for Buildings & Contents either together or separately for homes that have lodgers in residence.

Taking in a lodger is often done in a friendly “ad-hoc” manner especially if it is a family friend you are letting a room to and without any legal contract to be signed. We suggest that it is always a good idea to enter in to some kind of formal agreement even with a friend so everyone knows exactly where they stand, their responsibilities and what is included and excluded in the agreement. The contract should state, the amount of rent required, the period of the agreement, if the lodger is required to share the bills and if they are entitled to any other facilities or services at the property such as meals etc.

It’s important to establish the type of tenancy your lodger has been afforded and generally this falls in to two main categories.

Excluded Occupier

Your lodger will be classed as an “excluded occupier” if they live in your home but share a bathroom, kitchen or living room. Under this arrangement, the lodger is afforded very few rights and the notice period required usually mirrors the period allowed for paying rent. Thus if they pay you rent monthly, then the notice period is one month.

Basic Protection

Your lodger is likely to be afforded basic protection by the law if they live in your property but do not share any living space with you.This scenario is likely to relate to situations where perhaps you have a self-contained basement or annex. Under this arrangement you must serve the lodger a written notice to quit.

If you accept more than three lodgers in your property at any one time forming more than one household, we suggest that you contact your local authority to ensure that you do not need to register the property as a HMO,

If you require insurance for your buildings or for your contents, please contact us at Assetsure and we will be pleased to assist.