It’s no secret that the business industry is booming. That is why rentals such as buildings or rooms have been all over the street.
As the number of rental properties grows, the responsibility as an owner grows as well. What if the property is damaged? If you’re a lessor–you need landlord insurance coverage.
Landlord insurance provides financial support if your rental property is hit by storms, fire, and other unexpected incidents. If you’ll take a look, homeowner’s insurance is similar to landlord insurance.
However, homeowner’s insurance coverage is limited compared to landlord insurance. That’s why having a landlord policy is essential.
Here are some factors you should know before applying for a landlord insurance policy:
Usually, a landlord insurance policy has three core coverage; property damage lost rental income, and liability protection.
Property damage is the one that covers the rental property if a natural disaster such as fire, storm, and earthquake occurs. Other policies offer replacement cost or predetermined lump sum cash for the damages.
The lost rental income policy takes over if the property becomes unlivable. This usually happens if severe mold, termites, and rats become residents of the place. The policy provides financial assistance or temporary reimbursement to cover the rental fee your lessee should pay.
Liability protection, on the other hand, covers the medical or legal related fees if a tenant or a visitor accidentally hurt themselves. It only applies if the cause of the accident took place within the rental property.
Generally, the cost of your insurance depends on your tenants and property. The type of insurance and additional riders are also factors when it comes to the amount of your policy.
Your insurance company will also most likely consider your likelihood. The company will calculate your insurance based on your probability of the amount you will claim.
If you wish to know more about the cost, you can compare landlord insurance quotes with QuoteRadar.
There are other policy riders you should consider when applying for property insurance. This additional coverage may not be as important as the ones mentioned, but they can help you in the long run.
One of the additional coverage you should get is flood insurance. It applies especially when your place is flood-prone. Emergency coverage is also available for plumbing damages and other minor incidents in the property.
If reconstruction is needed, you should consider having additional construction expenses insurance. It will help you cover up with repair and construction needs for the damages.
Landlord insurance is not liable for the property of the tenant. Should your tenants demand or need insurance, encourage them to get renters insurance to protect their belongings.
Minor damages such as plumbing repairs or if a dishwasher break is not included in the coverage unless a supplementary rider is added with the insurance company.
If you have rental properties, it is necessary to have your units insured to save you from possible damages. Standard home insurance might not work. To protect your properties, you need to have the best insurance company to cover your needs.