Between the new restrictions that will soon burden landlords with the Climate and Resilience Act and the recommendations of the High Council for Financial Stability (HCSF) that have become binding, those who want or can still invest in 2023 for the purpose of renting have a better interest in being well insured to limit risks, for example in case of unpaid rent.
Loan insurance: optional guarantee for investors
During a rental investment, the guarantees required by the banks are generally less than when buying a main residence. In fact, the rents collected can be used to repay the loan repayments.
According to Nousassurons, insurance broker, borrower insurance or loan insurance for a rental investment must include, as a minimum, death/disability and PTIA (total and irreversible loss of autonomy) guarantees.
Optional: ITT (temporary incapacity), IPP and IPT (permanent partial or total disability) guarantees.
Because of the smaller guarantees that are taken out, borrowers’ insurance for such a purchase costs “all things being equal, about a third less than insurance for a main residence”, emphasizes We Insure.
Non-resident owner home insurance (PNO), even if there is no tenant
PNO home insurance, which is not mandatory, provides protection against risks arising during a period when the property is vacant by the owner, in addition to the home insurance policy taken out by the tenant.
It protects in particular in the event of fire, climatic events, natural disasters, broken glass, water damage and as an optional extra against theft of furnished rental accommodation.
It can intervene in addition to the tenant’s insurance, for example in case of water damage, if the work exceeds a certain amount. It also covers the owner’s civil liability, now mandatory since the Alur Act of 2014.
“The PNO insurance allows you to be covered within a co-ownership in the event of the tenant’s absence or if the tenant is not up to date with his contributions and is therefore no longer insured, explains Christel Caterino. , responsible for Nousassuron’s property offer. Or in case of an accident in connection with, for example, an electrical fault, where the owner’s liability can be incurred. »
The unpaid rent guarantee (GLI), to secure rents
In the event of non-payment of rent by the tenant, and until the property is taken over, GLI insurance guarantees the landlord for repayment of unpaid rent including fees (or accommodation compensation upon termination of the lease).
In addition, it provides for the amicable or legal recovery of unpaid debts, from the end of the tenancy until the tenant moves out. It thus gives the landlord legal protection.
Is this insurance still necessary if the bill aimed at establishing automatic termination of leases in case of unpaid rent is finally passed?
If it is adopted, “in the case of unpaid rent, landlords will be able to terminate the lease without having to go to court and thus get the tenant to move out more quickly, emphasizes Jérôme Robin, founder of Nousassurons. However, there will still be a need for legal action to recover unpaid rent… Even in this context, the unpaid rent guarantee remains essential. »
Another advantage: an extension of “vacant position” beyond the basic contract can be signed. In these cases, the insurance also covers reimbursement of loss of rent and charges during the idle period of the home (within the limits of the guarantee ceiling and excess).
Work injury insurance (DO), for major work
If work is to be done in the home, it is better to be well insured. The DO insurance comes in addition to the mandatory ten-year insurance for craftsmen, builders and material producers, which covers the risk of poor workmanship on a construction site for 10 years.
In the event of a problem covered by the 10-year professional warranty, DO insurance covers the damage, advances the cost of repairs and then seeks liability.
It then turns against the contractor or contractors’ insurer when there are several, eliminating the risk of endless complaints and denials of liability.
“The advantage is that, thanks to the advance of the costs, repairs can be carried out without waiting to identify responsibility, which can be useful in the middle of winter in the event of a problem related to the installation of a new system.” explains Christel Caterino .
The average price of DO insurance varies from 2 to 3% of the price of the work or construction. It is not essential for simple decoration work.
Taxes: premiums that can be deducted from rent collected
The unpaid rent guarantee (GLI), which represents an amount of 2.5 to 3% of the rent, is fully deductible in capital gains under the real estate tax scheme for empty tenancies and is also deductible in rental income in the industrial and commercial profits (BIC) category under the real scheme for furnished rent.
Other deductible insurance premiums: those for borrower insurance and non-occupant owner-occupier (PNO) home insurance.