Southend-on Sea-based FML Insurance Services has arranged a product aimed at giving peace of mind to landlords wishing to grant a lease to a commercial tenant.
The new product will allow the landlord to know that on the financial demise of a corporate tenant his rent will continue to be paid until the end of the lease or until the property is re-let, or the period of indemnity, whichever is the earlier.
Director Trevor Cryer said: "In the real world, requiring advances or large deposits may well send the tenant elsewhere and it is well known how reluctant people are to give personal guarantees which could still be difficult and expensive to enforce."
The policies are issued for up to three years and the premiums calculated at a percentage of the annual rental income and multiplied by the number of years of indemnity required.
The range of rental value to which it is being targeted is £50,000 a year upwards so they are not intended for the smaller commercial units.
The scheme, exclusive to FML, is underwritten by Templeton Insurance which is reinsured in the London Market.
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