Damage caused by Cannabis Farms not covered
More and more rental properties are being used to cultivate cannabis in the U.K. Many insurers have urged landlords to be vigilant as not all will pay out for damage caused by this activity.
Increase
Figures released recently indicate that 7, 865 cannabis farms were uncovered during 2011 and 2012, an increase of 15% from 2009 and 2010.[1]
Richard Burgess of insurance specialist website Cover4LetProperty.co.uk issued a stark warning to landlords on the growing problem. Burgess said, “Type ‘cannabis farms landlord’ into Google and you’ll see hundreds of stories of landlords facing huge repair bills, having unwittingly let their property to tenants who have then turned it in to a cannabis farm.
“Sadly, most landlords assume that this type of damage – which can include ripping up floor boards, knocking through walls and creating an indoor greenhouse environment – is covered by their landlords insurance, particularly if they have the ‘malicious damage by tenant’ element of cover.”[1]
Damage caused by Cannabis Farms not covered
Burgess reminds landlords that, ‘not all insurers provide malicious damage by tenant cover as a part of a landlord insurance policy.’ He goes on to warn that, ‘insurers will consider a cultivation of cannabis claim under the malicious damage by tenant section,’ but, ‘some will have limits, typically up to £5,000,’ which means that, ‘repairs can still end up costing a landlord tens of thousands of pounds.’[1]
Mr Burgess also says that landlords must remember to do more to eradicate problems of this nature escalating. On landlords, he says that, ‘part of their contract with their insurer is that they-or a representative-makes regular, logged checks on the property.’[1]
It is important, according to Burgess that landlords carry out thorough checks on all new tenants and look out for any early unusual signs. This may include taking an interest in the electrics of the property.
[1] http://www.landlordexpert.co.uk/2014/03/24/warnings-by-insurer-to-landlords-damage-caused-by-cannabis-farms-will-not-be-covered/