If you own your home and it’s your primary residence you more than likely only need homeowners insurance or condo insurance. If you own a home you plan to rent out or you have a room for rent, you may want to consider landlord insurance.
For tenants renting the property you may want to suggest for them to purchase renters insurance. Rental property insurance or landlord insurance will not cover your tenants personal property.
What is landlord insurance?
Rental property insurance also known as landlord insurance, is a home insurance policy designed to protect landlords that own homes, condos and apartments that they rent out.
Why is landlord insurance needed?
Usually most homeowners believe that their standard homeowners insurance policy will cover them for tenant damages. Unfortunately this is not the case.
Homeowners insurance is meant to cover homeowners for their primary residence and will not cover tenant damages or the tenants personal property. Because of this simple fact, landlord insurance or rental property insurance is an important addition to protect your investment.
How often you rent the home and whether you actually live in thee home will determine if landlord insurance is the right choice for you. In some situations homeowners insurance is all you need. It’s best to speak with one of our agents before making your decision so they can help you find the coverage that’s right for you.
If you do plan on renting the home out full time then landlord insurance is more than likely the better choice. Although, please check with one of our agents before hand so they can help you decide.
What does landlord insurance cover?
Rental property insurance coverage will come with 4 basic levels of protection, they are as follows:
Dwelling coverage:
Rental property insurance will cover you in the event the home is destroyed or damaged by a covered peril and will help you to rebuild or repair the structure of the home. Standard covered perils are typically fire, smoke, lightening, and windstorms. Landlord insurance will also cover detached structures such as garages, sheds, gazebos and more.
Property damage:
Landlord insurance will help to protect the landlords personal property used to maintain the home such as furniture, appliances like washers and dryers and dishwashers, and electronics. Rental property insurance will protect these items from free, theft, burst pipes and more.
Loss of use coverage:
If a covered peril destroys or damages the home and you are unable rent it to your tenants landlord insurance may reimburse you for any lost rental income.
Liability coverage:
Rental property insurance has liability protection as well. This portion of your landlord insurance coverage will protect the landlord from liability claims if someone is hurt or injured on the property. The liability coverage in your policy will cover legal and medical fees if a claim is made.
What’s not covered by landlord insurance?
Landlord insurance will cover you for various risks but it doesn’t cover everything you may run into. A few of the things that may not be covered under your landlord insurance policy may be:
Equipment and maintenance breakdowns:
If the equipment in the home such as an AC unit or washing machine break down there is a good chance you will have to pay out of pocket to repair them. The same can also be said for maintenance costs. If this is a risk you think you may encounter, then it would be a great idea to look into EBC (Equipment Breakdown Coverage).
Tenants personal property:
Landlord insurance will not cover your tenants personal property. It only covers the landlords property used to maintain the home. If your tenant would like to have coverage on their valuables they should look into renters insurance.
Earthquakes, flooding, water backup:
Much like homeowners insurance, rental property insurance will not cover you for flooding, earthquakes or water backups. If you believe these are perils you may have to deal with then it would be a good idea to look into additional insurance coverage such ass earthquake insurance, or flood insurance.
How much does landlord insurance cost?
Rental property insurance rates will vary from insurance provider to insurance provider. Other factors that may determine your rate may be the zip code the property is in and claims history of the landlord.
If you would like a custom landlord insurance quote or have additional questions regarding rental property insurance, please contact us today at 916 313 6100