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Posted by Hannah Lapin ● Mar 28, 2018 2:10:31 PM

What to Expect in a Landlord Insurance Policy

What to Expect in a Landlord Insurance Policy

An investment property is, well, an investment, and therefore needs to be protected. Standard homeowner’s insurance does not provide all the coverage needed for rentals, especially since rental properties are considered businesses and require extra liability. Therefore, getting a landlord insurance policy is imperative.

Most basic landlord insurance policies offer property protection and liability protection. Typically, property protection covers the structures of the home you are renting out, and other structures on the property such as a garage or fence. Sometimes it also protects the landlord’s personal property, such as furniture you may have or your lawnmower. Liability coverage helps with medical and legal expenses if someone is injured on your rental property.

In addition to a basic policy, we recommend considering supplemental coverage. If your property is in a designated flood zone, flood insurance will be required. For those properties not in a designated flood zone, flood insurance may still be beneficial, since flooding caused by external water usually is not covered by landlord insurance. In case your property becomes uninhabitable due to a natural disaster or damage by a tenant, Loss of Rent Coverage will give you peace of mind that your lost rental income will be covered.

It is important to note that tenant belongings and maintenance and repairs are never covered by landlord insurance policies. We recommend requiring your tenants to get Renters Insurance. For maintenance and repairs, we suggest considering a home warranty or planning accordingly, as maintenance will be inevitable.

Remember, all landlord insurance policies vary by provider and often have exclusions, so it is crucial to exercise due diligence when choosing a policy. For more help on selecting a landlord policy, see the FitSmallBusiness guide. To learn more about insurance, visit our Insurance Page.

Want to learn more about Landlord Insurance?

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Related: Why Renters Insurance Matters to Landlords, Why DP-3 Policies Offer the Best Coverage for Landlords 

Topics: Landlording, Insurance