When tenants face unexpected financial problems, their landlord can also quickly feel the pain.
To solve this, Legal & General has announced the successful completion of the pilot phase of its new Rental Protection Plan (RPP) for tenants, becoming the first UK provider to offer this type of product. The pilot was carried out in conjunction with the Mortgage Advice Bureau (MAB) and is only currently available via MAB intermediaries.
Nearly a quarter of UK households are expected to be in private rental accommodation by 2023 according to Knight Frank, but many tenants do not have any protection if the should fall ill, have an accident or lose their job, leaving them short of money and in danger of losing their home.
The Rental Protection Plan (RPP) offers the choice of three products through a single application and has been specifically designed for the rental market. The products, Rental Income Protection Benefit, Rental Life Insurance and Rental Life Insurance with Critical illness Cover, give them the flexibility to select the relevant products to meet their needs and budget.
RPP also gives tenants the opportunity in certain circumstances to increase the amount of cover if their rent increases, they relocate, or otherwise change tenancy agreement without the need to go back through medical underwriting.
Craig Brown, Director, Legal & General Intermediary, said, “Nearly a quarter of UK households will be renting by 2023 and the protection needs of these families will need to be met by products and solutions specifically designed for them.
First-time buyers usually receive a protection ‘nudge’ when they seek mortgage advice, but most renters do not benefit from the same prompt. This leaves tenants facing a greater risk of vulnerability due to unforeseen circumstances.”
Peter Brodnicki (left), CEO, Mortgage Advice Bureau added, “The tenant market is completely untapped with the current focus totally on protecting the landlord. Tenants have the same outgoings as homeowners, and so keeping both groups in their home should be our priority. Legal & General worked really closely with us to deliver a product we felt would really resonate with tenants, we have found that it’s done exactly that.”