View looking up at the side of a blue block of flats with balconies on each window

Referencing a Tenant

Insurance can be whittled down to a very simple summary, “a small known loss (the premium), in exchange for a potential, unknown, large loss (a claim). But what happens when the financial loss you have suffered is not covered by an insurance policy?

Loss of rental income can be claimed for if your property has suffered from an insured event e.g. fire damage, storm damage, escape of water. However, a landlord’s insurance policy is not designed to provide cover should your tenant fall behind with their rental payments.

If cover is needed for rental arrears you should consider a landlord’s rent guarantee policy to cover your legal costs incurred and the rent arrears due. As with any potential financial loss, it is better to be proactive than reactive. Listed below are some helpful touchpoints with regard to referencing your tenant and ensuring your property is in good hands:

Application stage:

All the information needed from your prospective tenants should be listed here on one form as well as your intention to carry out personal, professional and financial checks.

Online credit checks:

Names, previous addresses, credit score and any history of financial difficulties can be found and verified online to aid your research. There are many online companies able to provide this service. An online search of price and previous customer reviews can be carried out to ensure that the product is suitable for your needs.


A rule of thumb when prospecting tenants should be that they are earning at least 250% of their annual rent due to you. E.g. £10,000 a year rent should be covered by someone who is earning £25,000 a year after tax. Authorisation from your potential tenant to their employer to verify that they are in employment, for how long they have been employed by the company and their salary can help minimise dishonest applications.

A guarantor:

Any guarantors should be checked with the same due care and attention as the tenant. Should your tenant find themselves in financial difficulties, their guarantor should be able to meet their financial obligations to you.

Landlord’s legal expenses starts at £30.00 and a rental guarantee is £65.00 for the year. Should you have any queries regarding these policies then please do not hesitate to contact our office; we can provide written quotations showing all relevant terms and conditions on request.