Does the home insurance cowl rental properties? – FOX 9
Homeowner Insurance, Landlord Insurance or Commercial Property Insurance: What kind of policy do you need to protect your rental property? (iStock)
Whether you've just bought an investment property or are playing with the idea of renting out your own home for a short period of time, you're probably wondering what to do about real estate coverage. Many new landlords wonder if their existing homeowner insurance is enough to cover their rental property.
Unfortunately there is no single answer to this question. Instead, the type of coverage you need depends on how you plan to rent the property. With that in mind, we've listed some more details below. Read on to find out if you need to get additional insurance for your rental.
Does homeowner insurance cover rental properties?
If you rarely plan to rent out your primary residence for a short period of time, chances are your guests will be covered by your existing homeowner insurance.
While some providers only extend coverage, others offer you coverage through an additional driver that you can add to your policy. However, to get coverage in either scenario, you will likely need to inform your insurer about the tenants in advance.
If this type of policy is right for your needs, visit Credible to explore your homeowner's insurance options.
However, if you intend to rent regularly on short term, e.g. B. Renting out your property through Airbnb, you are unlikely to be covered by your existing homeowner insurance. If so, there is a good chance your property will be considered a business and you should get commercial property insurance instead.
In the event that you are trying to insure a full-time rental property, homeowner insurance is not appropriate for you either. In this case, consider a landlord policy, also known as a rental property policy.
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How to protect your rental property
While there are a few different types of home rental insurance, it is best to get a policy that includes the following types of coverage:
- Apartment coverage: This type of coverage covers damage to the property itself. Usually, however, it only covers damage in the event of a hazard. Therefore, it is important to understand what type of hazard is covered by your particular policy.
- Personal property coverage: Here, personal property coverage only covers those owned by the landlord. In particular, your tenant's belongings are not covered. If you want this type of coverage, your tenant should be required to have tenant insurance as part of your rental agreement.
- Liability insurance: Liability insurance protects you from paying legal or medical expenses in the event that someone is injured while living in your rental property.
- Loss of rental cover: Finally, loss of rental coverage will protect you from missing out on rental payments in the event that your investment property becomes habitable due to danger. However, you should double-check what types of hazards are covered by your policy.
Credible can guide you through any homeowner's insurance policy and coverage. Plus, they can tell you how to save hundreds of homeowner insurance policies every year.
In addition to your landlord insurance, you may also want to purchase the following types of supplemental insurance for your investment property:
- Vandalism reporting: As the name suggests, vandal cover protects you from willful damage to your property.
- Regulation or legal protection: Finally, this type of cover protects against losses caused by enforcing local laws while a property is being repaired.
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The final result
Regardless of whether you want to rent for the short term or long term, you need an insurance policy that will adequately protect your property. Whenever you are in the insurance policy market, it is best to shop around. Be sure to compare interest rates, lenders, and coverage options until you find the policy that works best for you.
When you're ready to take the next step, you can use Credible to compare homeowner insurance companies and shop for their plans.
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