You have a few spare rooms in your house and you have decided to rent them out to help with your housing costs. Assurances Multi-Risques would like to offer you a bit of advice in order to avoid insurance problems down the road.
First, we strongly advise that you contact your insurance agent or broker before letting out any rooms since not all insurance companies will insure you in such a situation. If your insurer agrees to cover you, you will then have to add a clause specifying that you are engaging in a professional activity as this situation is generally not included in a basic insurance contract. For insurers, a professional activity is any type of activity pursued on a regular and continuous basis in order to generate income, i.e. running a store, pursuing a trade, practising a liberal profession, or renting property. You must inform your insurer of this activity. If your insurer has not been notified, he may refuse to settle your insurance claim if a problem arises. For example, if one your boarders accidentally sets fire to the house, your insurer may categorically refuse to process your claim since this activity had not been mentioned in your insurance contract.
A few tips to insure your room boarding activities are well covered
- Immediately declare your new activity to your insurer and make sure that a clause mentioning this activity is added to your insurance contract. Specify the number of rooms that are being let out to boarders;
- If you are letting furnished rooms, make sure that your professional insurance covers the furniture since it is considered part of the property’s professional assets;
- Check with your insurer to see if the loss of boarding revenues is covered by the insurance contract.
A few tips to reduce property risks
- Make sure that each room has a smoke detector;
- Don’t allow the boarders to cook in their room. Instead, either invest in a communal kitchen or allow them to use your own kitchen;
- Select your boarders carefully. Don’t hesitate to ask them for references since you will be sharing your home with them;
- Have your boarders sign a lease;
- Avoid letting your rooms by the day or the week. Opt for an annual term and have your boarders sign a lease. Insurers don’t like short term leasing.
Assurances Multi-Risques strongly advises that you contact an insurance broker before you let your rooms. He will not only help you to save time, but will also help you to obtain what you need! Indeed, he will contact several insurance companies specializing in boarding house insurance in order to obtain the level of insurance coverage you need while making sure that you benefit from the best price possible!