When considering becoming a landlord and renting out your property, you may be wondering how insurance will help you manage the risks of your new arrangement.
Landlord Insurance is a specific type of coverage for this situation, and, along with working with a good property management company, is one of the best ways to be fully prepared to be a landlord.
What’s Covered by Landlord Insurance?
Each insurance company is different, and coverage will differ. Talk to your insurance agent for full details. But in general, Landlord Insurance may help you in the following situations.
- Fair Rental Value Coverage. This is the biggest difference between home insurance and landlord insurance. If your property becomes uninhabitable for a reason that is covered, Landlord Insurance should cover your lost rental income while repairs are being finished, usually up to 12 months.
- Dwelling Coverage of your rental property from fire, hail, vandalism, and other dangers.
- Coverage of other structures on the property, such as garages, sheds, etc.
- Coverage of Items that you own on the property, like appliances, furniture you’ve provided, or even tools you keep there.
- Liability Coverage; Legal Counsel and Medical expenses should someone become injured on the property.
Some insurance companies will offer discounts for certain circumstances, such as:
- New/ Recently-Renovated Home Discount, for rental properties newer than approx. 13 years old, or newly renovated.
- Multi-policies Discount, for those covering several properties, or a property and car, for example.
- Protective Devices Discount: may apply if you use a security alarm, a sprinkler system, deadbolts, fire extinguishers, etc.
Other Questions Insurance Companies May Ask
In order to determine the right coverage for you, your insurance company may want to know some additional information.
- Do you currently live in the same home as your tenant?
- How many properties are you renting out?
- What type of unit are you renting out?
- Do you rent out your property intermittently, or on a regular basis for longer periods of time?
If you have any questions about becoming a landlord, or about landlord insurance, Contact Tradewind Properties. We are here to help!