Landlord insurance provides coverage for residential property you rent to a tenant. It protects you, as the landlord, from financial loss due to property damage, liability, and loss of rental income.
Do You Need Landlord Insurance?
In general, if you own rental property, you need landlord insurance. Rental property can include a house, apartment, loft, condominium, townhouse, duplex, or mobile home.
A standard homeowners insurance policy is not adequate to protect your property when there is any rental exposure. You must talk to your insurance agent to obtain the proper coverage. Often times, the type of insurance policy you require depends on your insurance provider and the length and frequency with which you rent out your property.
Here are three common situations:
The long-term renter. Tenants staying for at least six months. Landlord insurance (also called a “rental dwelling policy”) is necessary.
The occasional short-term renter. If renting your primary residence only occasionally for short periods of time, you must notify your insurance company and secure adequate coverage for your particular scenario.
The frequent short-term renter. Property owners who rent their primary residence regularly for short periods (such as Airbnb, HomeAway, VaycayHero, and such) are usually considered business owners by insurance companies and not typically covered by homeowners insurance.
Why Do You Need Landlord Insurance?
Like homeowners insurance, landlord insurance protects you from financial loss resulting from accidents, natural disasters, injuries and other liability issues associated with rental property. It can also reimburse you for loss of rental income and can cover repairs of a rental property. Furthermore, in the event of a total loss, landlord insurance can cover the entire replacement of the rental property structure.
What Does Landlord Insurance Cover?
Landlord insurance covers three primary types of losses: property damage, liability, and loss of rental income.
Property Damage. Much like traditional homeowner’s insurance, landlord insurance covers damage from such perils as fire, storm damage, theft, vandalism, and tenant damage. It also covers property you leave for tenant use, such as kitchen appliances, furniture, lawnmowers, or televisions (but not property owned by tenants). In the event of a total loss, landlord insurance can cover the replacement costs of the entire rental property.
Liability. Landlord insurance protects you against liability claims and lawsuits. It helps you cover the costs associated with bodily injury claims on your property, which can include medical payments, funeral costs, legal fees, and judgment or settlement costs. You can also be covered if, as the landlord, you are found responsible for another person’s property damage.
Loss of Rental Income. Most landlord policies provide coverage for loss of rental income if the rental property becomes uninhabitable due to a covered loss.
Other optional coverage you may want to have for your rental property:
Building Code Coverage. If area building codes have changed, and the property is damaged and needs repair, this rider covers the additional cost of making required renovations due to changes in the building code.
Non-Occupied Dwelling Endorsement. If your property is vacant for more than 30 days, your landlord insurance company may deny coverage for any claims that arise after that 30-day period, and until it is re-occupied. This optional endorsement will extend your coverage during that period.
Flood Insurance. Coverage in the event of a flood is not included in landlord insurance. Flood insurance is a separate policy.
Umbrella Insurance. All insurance policies have limits to the liability coverage they provide. An umbrella policy provides coverage beyond your landlord policy’s limits.
ABC Dennis Insurance Agency
ABC Dennis Insurance is an independent insurance agency established in 1997 that provides landlord insurance to individuals and businesses.
As an independent agency, we find the best coverage with the most competitive rates among multiple insurance companies. This is important because no insurance company can meet every insurance need. So, we shop multiple insurance carriers to find the coverage that best fits our customers’ every need.