Fundamental changes to the way in which the housing benefit system operates are likely to have a significant impact on the overwhelming majority of property owners with landlord insurance.

According to research from the National Landlords Association, three out of every four private sector landlords operating in the Local Housing Allowance (LHA) market are considering their future in the sector.
A cap is being introduced to limit the amount of money paid to tenants which is likely to leave many in more expensive areas out of pocket when it comes to paying their rent.

Tenants will either have to find the remainder of money outstanding themselves, or try to renegotiate with their landlords for a reduced rental rate - something unlikely to happen at a time when rents are actually increasing and demand is at a record high.

Among the changes expected is a reduction in the number of LHA tenants in the sector - something which is already happening with a quarter of landlords.

Many others are likely to follow suit in the future.

Landlords therefore need to be on their guard against the possibility of tenants defaulting but, more likely most will simply look to pick up new tenants from the mainstream private rental sector.

Whatever you decide to do as a landlord, make sure you are protected through buy to let insurance.