While letting your property out to tenants can be a very successful business, there are plenty of pitfalls for the unwary. One you might not have thought of is a tenant running a cannabis farm from your property.
With an “industry” estimated to be worth £2.4 billion in England and Wales during 2021, there’s plenty of incentive to grow the drug. Unfortunately, this can be extremely expensive for the owner. Quite apart from any problems proving that you’re not legally responsible, a cannabis farm can cause plenty of damage. And, if you make an insurance claim to recover your costs, you could find the insurer’s loss adjuster turning you down.
One owner, who suffered £15,000 worth of damage in 2018, found herself unable to get any recompense, even though the letting agency she’d hired had failed to take note of the warning signs. Due to the police being unable to establish beyond reasonable doubt who had actually set up the farm, no-one was ever charged over the case — meaning that she was told she’d have no chance of reclaiming the money from either tenant or agency.
What Can You Do About It?
In 2020, 445 cannabis farms were found in London alone, with the West Midlands, Lancashire and West Yorkshire other hotspots. Nationally, 48% of investigations into electricity theft, a common part of the operation, are related to cannabis production.
If you’re a landlord, you can protect yourself against this kind of abuse in two ways. Firstly, you can ensure you work with a good letting agency, who’ll identify obvious warning signs. These might include:
- Tenants who want to pay several months in advance in cash.
- Tenants who fail to cooperate with inspections and who change locks.
- Blacked-out windows and sealed vents.
- Large amounts of condensation on the windows.
- Electric fans running all the time.
- Tampering with electricity meters and electric cabling.
- A distinctive sickly-sweet smell inside the house.
At the same time, it’s important to make sure your insurance policy includes adequate cover for this situation. Many policies restrict insurance claims for cannabis farm damage to as little as £5,000, or even completely exclude them.
To make sure the loss adjuster doesn’t have a reason to refuse payment, Allied Claims would advise you to check your policy thoroughly — preferably by going through a good insurance broker, who’ll help you find a more appropriate policy, if necessary.
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