THE MarKET

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					     LandLords’ InsUranCE




     THE MarKET.
     Market information highlights




This document is for professional use only


INSURANCE. SAVINGS.
INVESTMENT MANAGEMENT.
During the early part of this decade,      Although the property bubble
the number of buy to let mortgages         recently burst, lending is once again
increased dramatically, rising to a        on the rise so there are still significant
peak of 1.15 million in 2008. Fuelled by   opportunities for advisers selling buy
the appeal of rising prices, investors     to let mortgages and landlords
bought rental property as a safe haven     insurance.
for their future.
                                           So, if you’ve not considered selling
                                           landlords insurance before, or you
                                           want to know more about it, now is
                                           a great time to get involved.



                                           FIrsT-TIME bUyErs prICEd oUT                 soCIaL and dEMograpHIC
  How doEs THE rEnTaL                      The rapid rise in housing prices over        CHangEs
  MarKET LooK now?                         the past ten years means that many           Inward migration and a rise in one-
                                           first time buyers are still priced out of    person households have impacted
                                           buying a home, increasing demand for         demand in the rental market.
                                           rental property.
                                                                                        rEgULaTIon CoMpLICaTIons
                                           sTrIngEnT LEndIng                            Additional regulation, such as Housing
                                           CondITIons                                   Health & Safety Rating System and
                                           Mortgage lenders are imposing                the redefinition of Houses in Multiple
                                           stringent lending conditions such            Occupancy, is forcing some smaller
                                           as high deposits, which means                landlords out of the market.
                                           potential buyers are staying in rented
                                           accommodation for longer.

                                           rEnT arrEars an InCrEasIng
                                           probLEM
                                           One in five landlords† have tenants in
                                           rent arrears which will further increase
                                           demand for insurance that includes
                                           cover for legal expenses and rent
                                           guarantee.

                                           HIgH LEvEL oF rEpossEssIons
                                           The Council of Mortgage Lenders
                                           estimate 39,000 repossessions in 2011.
                                           These people will be looking to the
                                           rental market for somewhere to live.




                                           on THE Up                                    In IT For THE Long-TErM
  wHaT aboUT                               Buy to let lending rose by 12% in 2010*      85% of landlords still believe property
  THE FUTUrE?                              and with ongoing growth predicted for        is a good long-term investment.
                                           the future, 2011 looks to be a year of
                                           opportunities in this market.                an opTIMIsTIC oUTLooK
                                                                                        By 2012/13, growth in the landlords’
                                           LargEr porTFoLIos                            insurance market are predicted to
                                           A landlords average portfolio size is        return to 2008 levels.
                                           likely to increase in the next 3-5 years
                                           as a result of increased confidence in       *Council of Mortgage Lenders
                                           the market.                                  †
                                                                                            The National Landlords Association 2010
                 spECIaLIsT prodUCT wITH a                 QUaLITy MorE IMporTanT
wHaT doEs THIs   sIgnIFICanT MarKET                        THan prICE
MEan For yoU?    We estimate the current landlords         Landlords want to protect their
                 insurance market to be worth between      investment and consider insurance a
                 £600 and £800 million in 2010.            relatively small cost in comparison to
                 Approximately £165 million will switch    the value of their property.
                 between providers each year.
                                                           The quality of the cover is often more
                                                           important than the price, which means
                 growIng MarKET, growIng                   that landlords are prepared to pay for
                 bUsInEss                                  quality and additional cover options.
                 We believe the landlords insurance
                 market will grow steadily each year to    Cross sELLIng opporTUnITIEs
                 over three million policies by 2013.      Property investors tend to be affluent
                                                           professionals earning over £50,000,
                 By understanding this market now,         which can make them a perfect target
                 you can benefit from this growing         market for other insurance, protection
                 business.                                 and investment products.




                 FLExIbLE CovEr                            rEpUTabLE provIdEr
KEy ConCErns     Landlords will want varying degrees       The provider needs to be reputable and
For LandLords    of cover depending on the property        financially secure. They should also
                 and their needs.                          be able to demonstrate an in-depth
                                                           knowledge and understanding of this
                 spECIaLIsT CovEr                          market.
                 Landlords insurance is not like
                 conventional home insurance as most       ExCELLEnT sErvICE LEvELs
                 policies do not cover rental properties   If your clients need to make a claim, it’s
                 that are occupied by tenants.             imperative that it is handled quickly and
                                                           efficiently. Any delay could impact your
                 sIMpLICITy                                client’s reputation, income and asset.
                 The policy should be flexible,
                 comprehensive and it also needs to
                 provide clear choices for the landlord.




                   For details of Legal & general’s Landlords’ Insurance, please
                   speak to your usual Legal & general representative
                   or email gienquiries@landg.com
   ConTaCT Us

   gienquiries@landg.com
   or contact your usual Legal & General representative




Legal & General Insurance Limited. Registered in England No. 00423930.
Registered office: One Coleman Street, London EC2R 5AA
Authorised and regulated by the Financial Services Authority
CW1957 02/11

				
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posted:5/18/2011
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