November 27, 2018
What Does Landlord Insurance Cover?
When you’re renting out a property, there’s a lot that can happen, from overflowing tubs to kitchen fires. And, your regular homeowner’s insurance – which may provide limited coverage – isn’t intended to protect a rental property. Property owners who rent out their residential home, apartment or condo need protection in the form of landlord insurance.
What Is Landlord Insurance?
Landlord insurance covers several must-haves for investment property owners not covered by other types of home and contents insurance policies. It provides peace of mind protection against financial loss in the case of a fire or other unfortunate event
What It Covers
While it can vary depending on your policy and needs, generally speaking, this type of insurance contains three key components: property insurance, liability insurance and loss of income insurance.
There are multiple ways to insure a rental home. Some insurance policies cover a limited number of perils, while others are more comprehensive. Overall, many policies cover monetary loss stemming from fire, theft, storms, and vandalism. Depending on whether you are covered for depreciated value or guaranteed building replacement, the loss settlement can vary as well. Read the fine print to ensure you have the best coverage possible.
The liability part of your insurance will help you pay legal costs or medical bills that you are liable for. This protects against negligence claims, say in the case of a tenant who slips and falls on some icy outdoor stairs that you failed to maintain. It also provides third-party liability protection against property damage caused by employees or contractors.
Loss of Income Insurance
Landlord insurance can cover loss of rent. If your rental becomes inhabitable after a fire or flood, forcing your tenant to move out, this protection is invaluable. It will ensure the rental income so you can continue to pay the mortgage while getting the repair work done.
What Landlord Insurance Doesn’t Cover
If a tenant causes property damage (for example, leaving a tap running and flooding the basement), they’re responsible for the cost of repairs. But if they don’t have any insurance coverage, you could find yourself footing the bill. Many renters mistakenly assume that the landlord’s insurance covers their personal belongings. Or they fail to secure enough insurance to replace their property or protect against liability if they cause damage to your building.
Be sure to ensure mandatory tenant insurance by including a clause in your lease, tracking required insurance coverage through your tenant portal and offering affordable tenant insurance.
How Property Vista Helps
Property Vista offers web-based software designed to help landlords run their properties more efficiently and more effectively. We offer online resident applications and intelligent credit checks, communication and maintenance portals, as well as tenant insurance. To learn more about what we can do to help maximize your growing business, book a demo.