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28 May, 2023
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Landlord Insurance

What You Need to Know About Landlord Insurance?

Landlord insurance differs from homeowner’s insurance in a variety of ways. It provides financial protection in the event a rental property sustains damage or becomes unlivable after a catastrophic event. Furthermore, it provides protection when an individual suffers an injury while on the property. 

People often assume their homeowner’s insurance provides the same level of protection. However, a homeowner’s policy only offers limited coverage. For this reason, every landlord should speak with their insurance agent to determine which coverage they need. Many people find they need to buy another policy from Roger Butler Insurance following this coverage to protect their assets and their future. 

Rental Statistics

Millions of Americans rent property each year to others. In fact, more than 115 million men and women live in a rental unit today, according to the Rental Protection Agency. This agency reports 544 new people become landlords every day, with 2,654 new individuals renting a property every day. It collected this information from the 2000 Census, and new numbers may come out of the 2020 Census. However, it goes to show how this market continues to thrive in the United States today. 

The landlord bears the responsibility of finding tenants for the property while also maintaining and keeping it up. They need to ensure the property remains protected in the event of a storm, vandalization, or another catastrophic event. This is where landlord insurance comes into play. 

What Is Covered?

Although landlord insurance policies vary by the provider and the policy selected, most policies of this type cover certain things. The amount of coverage also varies by what the owner selects. 

Property damage insurance tends to be standard on these policies and covers physical damage to the home resulting from criminal activity, weather events, or fire. In addition, it covers other structures on the property, such as a detached garage or shed. If the property holds equipment used to maintain it, this portion of the policy covers damage to the equipment. This includes coverage for lawnmowers and snowblowers. 

Landlords frequently count on the income generated by the property to pay a mortgage or repair bills. A typical landlord policy reimburses the owner for any income they lose when the house is uninhabitable as the result of a covered loss. The loss of income reimbursement continues as long as the premiums are paid until the property can be rented again. 

Liability insurance coverage protects the property owner or landlord if a person is hurt while living in or visiting the rental property. The policy covers any medical expenses insurance as a result of the injury. In addition, it covers legal fees or settlements associated with the injury. 

What it Doesn’t Cover

Any items belonging to the tenant residing in the rental property will not be covered under the landlord insurance policy. If the tenant sustains losses, they need renter’s insurance to be reimbursed for those losses. This includes their furnishings, clothing, vehicles, or any other items. 

Furthermore, the policy does not cover any repairs that are needed in the home. This falls on the property owner. The owner must determine how much they need to charge in rent to pay any mortgage and properly maintain the property. 

Landlord insurance protects a person’s investment in their rental property. The goal of owning rental property is to generate income to cover any expenses related to this ownership while building equity in the home. Speak to your insurance agent today to learn how much coverage you need. 

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