Landlords’ Biggest Insurance Needs

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Do you have adequate protection for your property?

As a landlord, protecting your investment should be at the top of your list. Whether you’re renting out a single family home, an apartment, condo or townhouse, it’s critical to ensure that your property is protected against a variety of events that could cause damages and losses. And if you’ve just begun acting as a landlord, it’s important to understand the difference between a regular homeowner’s policy and a landlord’s policy.

What is Landlord Insurance?

Landlord Insurance is a policy that’s designed specifically to protect rental properties. There are several different types of policies, including property damage, liability and loss of income. Here’s a breakdown of what each one covers:

Property damage

A landlord’s property damage policy covers damage to the building and any other structures on your property (sheds, detached garage) in the event of theft, vandalism, fire, storm damage or damage caused by your tenant. When choosing a damage policy for your rental property, your coverage will include repairs and replacement costs for the damages and for the entire property if you experience a total loss.

Liability Coverage

A liability policy will protect you against any liability claims or lawsuits in the event that someone is injured on your rental property. Whether your tenant, a guest or anyone else is hurt while inside or on the grounds of your property, they could file a suit against you for their injuries. 

 

Liability insurance will cover things like medical payments, legal fees and any judgment or settlement costs. Liability will also protect you when an unforeseen event causes damages to your tenant’s property—like a leaky pipe that causes damage to personal belongings.

Loss of Income

A loss of income policy will protect you when something causes your property to be uninhabitable and thus un-rentable for a period of time. If there’s a covered event, like a fire or damage from a storm, and your tenant is unable to live there, you will be compensated for the amount of rental income that you lost during that time period.

Other optional coverage

Depending on where your property is located, you may want to consider getting other policies to protect your property from floods, which is typically not covered in property damage or liability polices. Also, if you have furnishings or other personal properties inside the rental, you can purchase a contents policy that will pay for the replacement of items damaged or destroyed.

Is landlord insurance required?

There is no law in Florida that requires you to carry landlord insurance, however, it is highly recommended. If you are renting out a property or even part of your home, you are taking a big risk without adequate coverage. Things like fires, tornadoes, theft, vandalism and unexpected accidents that cause injury to others or damage to your property can be extremely costly and without insurance, you stand to lose a lot.

 

Real estate can be a viable investment opportunity and owning rental properties is a great way to make a consistent income. If you haven’t yet purchased landlord insurance and would like guidance on how much protection you need, contact us and we’ll be happy to help.