When managing a House in Multiple Occupation (HMO), landlords and tenants often have questions about responsibilities, including who pays for the insurance. HMOs, which are properties rented by multiple tenants who share common facilities, such as the kitchen, bathroom, or living area require a different type of insurance than standard landlord policies.
Understanding the risk management responsibilities is crucial for both landlords and tenants. Our HMO Landlord Insurance team have outlined the key details below.
What are some examples of a HMO?
- Student Housing – A house shared by multiple students who each rent a room but share communal areas like the kitchen and bathrooms
- Professional House Shares – A property where working professionals rent individual rooms while sharing common facilities
- Bedsits – A building divided into separate rooms, often with en-suite bathrooms but shared kitchen facilities
- Hostels or Lodging Houses – Accommodation where multiple tenants pay rent for individual rooms, often with shared cooking and bathroom facilities
- Converted Flats – A property originally a single home but converted into multiple units that share facilities, such as an older house split into self-contained bedsits
- Asylum Seeker or Social Housing Accommodation – Properties rented out to individuals placed by councils or social services, typically under shared living arrangements
- Multi-Let Houses – A standard residential property where multiple unrelated tenants each sign separate agreements with the landlord
Do I need HMO Landlord Insurance?
Unlike standard landlord insurance, HMO properties face unique risks due to multiple tenants sharing living spaces. Without proper insurance, landlords could face significant financial loss due to property damage, liability claims, or rental income disruption.
HMO Landlord Insurance takes into account the increased risks associated with multiple occupants, such as a higher likelihood of accidental damage, fire hazards, or liability claims. Additionally, some local authorities require specific insurance coverage as part of HMO licensing regulations.
A typical policy may include:
- Buildings Insurance – Covers structural damage from risks like fire, floods, and storms
- Contents Insurance – Protects items provided by the landlord, such as furniture and appliances
- Property Owners’ Liability Insurance – Covers claims made by tenants or visitors due to injury or damage
- Loss of Rent Cover – Provides financial protection if the property becomes uninhabitable due to an insured event
- Legal Expenses Cover – Assists with legal costs for disputes, eviction processes, or other legal matters
Who Pays for HMO Insurance?
Landlord’s Responsibility
The landlord is responsible for arranging and paying for the HMO Landlord Insurance policy. This ensures that the property is adequately covered against unforeseen risks. The cost of insurance is considered an operational expense and may be factored into the overall rent charged to tenants.
Tenant’s Responsibility
While landlords cover the building and their own contents, tenants are responsible for insuring their personal belongings. Tenant contents insurance can protect personal items like electronics, clothing, and valuables from theft, accidental damage, or loss. Tenants should ensure their policy covers shared areas if they store belongings in communal spaces.
About Lansdown Insurance Brokers
Lansdown Insurance Brokers are specialists in Landlord Insurance and HMO Landlord Insurance helping property professionals navigate the complexities of insurance and risk management. Whether you’re a landlord, letting agent, or property owner call the team on 01242 524 498 or email enquiries@lansdowninsurance.com.
Lansdown is part of the Benefact Group, a charity-owned, international family of financial services companies that gives all available profits to charity and good causes.