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Norwich Union is warning landlords to be extra vigilant when vetting tenants and inspecting their properties, with cases such as residential cannabis farming continuing to rise.

Landlords need to be constantly vigilant of what could be happening in their properties – drugs, prostitution, violence or even the storage of stolen goods need to be nipped in the bud – it's your investment at stake.

During 2007, Norwich Union says there were 5,497 seizures of cannabis plants by police, an increase of 34% since 2005. During this time the insurer settled around 60 residential claims totalling over £1m. The damage can vary from holes made in the walls through to water damage or even to the property catching fire.

Mike Colmans, underwriting manager for property owners at Norwich Union says: "There is an increased risk for landlords and their properties. They may not be aware that if their property is damaged by tenants using it for the things such as the production of cannabis, they may not be covered if they haven't taken ‘reasonable precautions' to prevent it happening.

"Vetting the tenant is essential. As is carrying out extensive background checks, including checking bank details and references. Don't accept payment for rent in cash but, instead, insist it is paid through a bank. Landlords should be wary if a short-term let is requested, and sub-letting should be discouraged. Once the tenant is in the premises, carry out regular inspections, both externally and internally if possible."

SOURCE: Norwich Union, 13/02/09

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