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If you own a holiday home abroad, you can get an easy extra income by letting it out when you’re not using it, as well as giving you the peace of mind that your property is not just lying empty and vulnerable in your absence. Unfortunately in reality it’s not that simple and there are risks involved in allowing strangers to stay in your holiday home. After all, you have a lot of money invested in your place in the sun, and letting, although there are obvious benefits, increases the risk to your property and possessions. But it is a problem easily solved, all you need to do is make sure that your second home insurance policy covers you for the type of problems that could arise from letting your holiday home.

A lot of insurance policies for holiday homes do not include cover people other than family and friends, so make sure you get a specialist holiday let insurance policy, which will allow you to rent the property to other tenants. Of course there are obvious risks to letting strangers into your holiday home, so making sure you have a policy which covers accidental damage to the house and its contents will help reassure you that you are protected for any eventuality. Another thing to consider is what you would do if something did go wrong with the property and the potential loss of rental income – some policies will not only cover this cost but also provide alternative accommodation for you and your tenants in the event that the property is uninhabitable.

When you’re choosing your insurance policy the main thing to remember is to always read the small print. You might find that house insurance in Spain, Italy and other popular holiday destinations is cheaper to buy from the country in question, but these European policies for holiday homes are often a lot more limited than UK policies in the cover they offer. For instance some countries do not insure property against damage caused by a guest or tenant as standard, and assume that visitors will have their own ‘liability insurance’ policy. A catch like this in your insurance policy could put people off visiting from the UKL as it would mean them paying more for their holiday, not to mention the fact that if anything did happen and the tenants were uninsured, you wouldn’t be covered. The easiest solution is to take out a second home policy based in the UK, where public liability insurance is included in the premium as standard.

Another common mistake that holiday home owners make is accidentally signing a policy where they are required to visit the property and peform regular checks every week. Failure to do this would render the policy invalid but obviously when your holiday home is hundreds of miles away this is just not possible. Fortunately there are many policies that don’t include requirements like this, so with a bit of shopping around it’s possible to get a great deal but remember that it is still a good idea to have an agent or a reliable neighbour look in on your holiday home regularly for your peace of mind and in case anything does go wrong while you are away.