Basics You Need to Know About Landlord Insurance


The first thing to know about landlord insurance is that it is not a homeowner’s insurance. If you have a property and want to rent it out, you need separate landlord insurance, as now; there will be a tenant on your property. This is because homeowner insurance will only work when the owner resides in the property- not the tenant. For better guidance and advice, you can consult experts like

What Will The Landlord Insurance Cover?

Landlord insurance will cover property damage in the tenant’s hands and loss of rental income if the property is temporarily uninhabited. It will also offer liability protection. You will be covered if the tenant misses out on the monthly rent payment or if you have to pay for any damages due to environmental hazards.

If you are looking for comprehensive landlord insurance, you should consider these three main factors.

Main Factors of comprehensive landlord insurance

Property Damage

The insurance will provide coverage in case a natural disaster damages the property. You cannot blame the tenant for a flood or forest fire, but if you are not occupying the house at the time of the disaster and your tenant is, your homeowner’s policy will be no good.

The property damage clause in landlord insurance will also take care of vandalism or fire and even replacement costs if you have to get something new to ensure the tenant’s safety on your property.

Rental Default

This clause covers the cost of rent in case your property is rendered uninhabitable due to some reason. In case of a severe mold, a sinkhole, or pest infestation, you have to clear and fix your property entirely before you could hand it over to someone else for staying. You will get rental reimbursement to cover the rent you would have received if tenants were on your property.

Liability Protection

This will provide you protection against medical costs or legal costs in case a tenant or any visitor gets injured on your property. They could raise a property maintenance suit at court like a part of the property collapsing, a beehive you were not aware of, or any icy walkway that fell through. This can result in huge expenses which you would have to otherwise pay from your pocket.

With some riders,

You can also get coverage for some of the following areas.

Guaranteed Income

You will get this amount if the tenant cannot pay you the rent for one or more months. This will safeguard you against loss of income as many landlords depend on their living.

Flood Insurance

Flood insurance or natural disaster insurance safeguards you if your property is damaged in a natural disaster. Many landlord insurances do not cover this point, so you need to get it as an additional rider, especially if you live in a flood-prone area.

Emergency Coverage

This will come in handy if the tenant suddenly calls you to fix something on the property like a faulty dishwasher or a leaking roof. You cannot ignore the issue as a landlord, or you will be accused of negligence. But the insurance money will cover you in case you have to bear with these sudden expenses.

Additional Construction Expenses

These riders cover the cost of repairing damaged property and bring it up to meet the property codes after it has been damaged in some way. Meeting the guidelines ensures that quite a few things would have to be fixed, and this could mean a lot of expenses, but with this rider, the insurance company will take care of it.

While determining the premiums, you have to understand that there is an inverse relationship between the premiums and the time you have put your property on rent.

So, you would have to pay more premiums if you have let out your property for six months compared to what you would have paid in case you had let it out for a year. This is because short term tenants might be more careless about the property and forego to report damages. This could result in the insurance company paying more in the long run.

It would help if you also told your tenant to get a renter’s insurance as landowner insurance does not include the tenants’ belongings.

A landowner’s insurance will give you complete peace of mind when you let out your property to strangers. It is meant to protect your interests and property so that you do not have to worry about any damages that might come to your house.


Please enter your comment!
Please enter your name here