RENTAL PROPERTY INSURANCE: EUGENE C YATES INSURANCE AGENCY BASIC GUIDE TO LANDLORD INSURANCE

When landlords rent out an apartment, house, vacation home, or condo the first time there’s a good chance they may think their homeowners insurance will cover the risks they may run into. This is usually not the case and they will be vulnerable to natural disasters, accidents and other damage. 

Why do you need rental property insurance?

Homeowners insurance is designed to cover risks that are associated with being a primary homeowner that lives in the home. When you begin to rent out your property to tenants a lot of this will not be applicable. In addition, your renters will not be help liable for the landlords property such as large appliances and other fixtures within the home. Also if someone becomes hurt or injured on the property the landlord is typically the one responsible for the claims. If a fire or theft takes place this is as well the responsibility of the landlord renting the property. These are only a handful of the issues you could run into, there are many more you should protect your investment from.

The great thing about rental property insurance is it is designed to cover you for almost everything that homeowners insurance will not. Please keep in mind that landlord insurance comes in many different varieties and will vary from insurance provider to insurance provider and city to city. It’s a great idea to do a little research before you start comparing prices to find your best deal. 

This is where a reputable local independent insurance agency such as Eugene C Yates Insurance Agency comes in. Our agents have access to the best landlord insurance providers and a world of knowledge when it comes to rental property insurance discounts. 

What Does Rental Property Insurance Cover?

There are three main protections a standard landlord insurance policy will contain:

Property damage:

This portion of your coverage will protect the structure of the home and furnishings inside the home if a natural disaster should occur such as a fire, vandalism, tenants that are neglectful and more. One of the better ways to go would be a replacement cost policy versus an actual cash value policy and is even better than a predetermined lump sum of cash.

Loss of rental income or rental default insurance:

If one of your tenants is completely unable to use the home and it is deemed uninhabitable due to a covered peril such as termites, mold, infestation or at worst a sink hole, this portion of your coverage will provide rental income reimbursement for whatever you lose in rental income. 

Liability protection:

If someone is either hurt or injured on your property and sues you, this portion of your coverage will help to pay for medical coverage and legal fees. 

There is a good chance you may see your landlord insurance provider mention coverage packages such as DP-1, DP-2, and DP-3. These all are referring to the type of rental property coverage you’re looking to purchase. They are different levels of landlord insurance. DP-1 is going to be the very basic amount of coverage, which would make DP-3 the more comprehensive form of rental property insurance coverage.

Additional landlord insurance coverage

When it comes to landlord insurance there are many ways you can go in. There are a few riders that can make your policy more comprehensive and other exclusions you can make to make it more affordable. It really depends on what you need coverage for your rental property. Below we go over a few things you can include to expand on your basic coverage:

• Guaranteed Income Insurance—This covers the landlord if a tenant comes up short on the rent one month (or doesn’t pay at all).
• Flood Insurance—As many landlord insurance policies don’t include flood damage related to natural disasters or municipal plumbing, this coverage is worth adding if the property is in a flood-prone zone.
• Emergency Coverage—In the event a tenant calls you out to fix something such as a leaking dishwasher or was accidentally locked out of the house, this feature can help cover some or all of the costs you incurred to travel to the property and resolve the issue.
• Additional Construction Expenses—This will cover expenses incurred by having to bring a building up to code after it has been damaged.

Landlord insurance quote

If you are looking to get the best landlord insurance quote or have more questions regarding rental property insurance, please feel free to contact us at 916 313 6100