Moneysupermarket.com has warned homeowners considering moving home and renting out their current property instead of selling, to take out the appropriate landlords insurance policy.

While the housing market is still fluctuating many homeowners are considering renting instead of selling their properties. This means their home insurance policies will no longer be valid and they will need to take out a landlord’s insurance policy that covers the increased risks of renting.

Although tenant demand is on the rise and lenders are slowly re-introducing good value buy-to-let mortgages the right insurance is vital to protect your investment. Last year, one in three landlords had tenant arrears, so take out a policy that includes rent guarantee to protect the rental income if tenants can’t pay, and legal expenses should they arise for example in the case of repossession, tenant default and debt recovery.

Julie Owens from moneysupermarket.com said, “Landlord insurance which includes Rent Guarantee cover or legal expenses can be more expensive, however if things go wrong between a landlord and tenant legal proceedings can involve a hefty cost. It is important to have a good contract in place to know where each party stands should the tenant and landlord relationship fall sour.

“I advise insuring yourself against these circumstances before they arise, it is always better to be prepared and there are a number of suitable insurance policies for landlords on the market.”

For a more information about landlord insurance or legal expenses and rent guarantee insurance products visit Discount Landlord Insurance.