What is landlord insurance?
Landlords insurance, also known as a 'landlord policy', is a special type of insurance that provides comprehensive coverage for those who own and rent out properties. This can be a house, apartment, villa, condominium or similar type of structure. It helps protect against financial losses that may occur as a result of damage to the rental property. Examples of such damages include burglary, fire, flood, severe weather and various types of natural disasters. If the rental property becomes uninhabitable, this type of insurance will help cover the loss of income you may suffer.
Landlords Insurance Coverage
There are many types of landlord insurance coverage available to property owners. The coverage options you have will depend on the company you choose to work with, the options you choose, and the area in which your rental property is located.
Below are the types of coverage most often chosen by property owners who rent or rent to others:
Property damage
This type of insurance covers both your rental property and the personal property inside it in the event of storms, theft, fire, vandalism or damage caused by tenants. In most cases, this coverage covers your entire property.
Liability
This type of coverage protects you, the property owner, from lawsuits and liability claims. For example, if someone is injured or dies on your property, this coverage can protect you from paying for medical expenses, funeral expenses, or other claims related to personal injury or death.
Loss of income
This coverage helps you get compensation in case your rental property becomes uninhabitable due to some kind of loss. It is often referred to as "Rent Recovery".
Other types of coverage
There are many other types of coverage you can choose from with landlord insurance. These include natural disaster coverage, flood coverage, property contents coverage, and even employer's liability coverage.
Is landlord insurance required by law?
Handing over the keys to your home may not be easy. However, you may be economically conscious, trying to make ends meet or save as much as possible from this investment. By law, landlord insurance is not a requirement; but not having this type of insurance can lead to huge costs and serious problems. If you rent out property, collect rent for that property, and are directly responsible for the management of any type of rental property, it is in your best interest to have this type of insurance.
Insurance can help cover costs associated with unforeseen events and circumstances.
Examples of these problems include building fires, tornadoes, thunderstorm damage, tropical storms, hurricanes, blizzards, earthquakes, volcanic damage, ice and vandalism.
How much does it cost?
The cost of landlord insurance varies. There are many factors that determine how much insurance will cost. Some can get a policy for as little as $500 a year; however, this usually only covers very small units and comes with many limitations in terms of options.
Larger units and those with risks, such as ponds and pools, can cost several thousand dollars for a year of coverage. The size of the structure, the location of the rental property, the age of the structure, the general condition of the property, the presence of a security system, the availability of fire sprinklers and similar products will directly affect how much you will pay for landlord insurance.
If you are a landlord or property manager, landlord insurance is a must. It not only protects your property, but also protects your tenants and yourself.
If you need help dealing with tenants, preparing your rental property, marketing your property and optimizing the success of your business in general, we can help! We can also help you get the best rate and coverage for landlord insurance.