Do You Need a Landlord Insurance Policy?
Anyone who rents a home or condominium to a tenant is usually advised to take out a landlord insurance policy. A landlord policy is a special type of policy that protects from the damages that can occur to a property while it is occupied by a tenant rather than the property owner.
Who Needs a Landlord Policy?
In general, those who rent out a room but still live within their home do not need a landlord’s policy. But those who do rent the entirety of a unit, whether it’s a home or condominium, will usually not be able to be covered by a general homeowner’s insurance policy. That means that damages to the property will only be covered through a landlord policy.
How Does a Landlord Policy Work?
A landlord policy does not need to involve the actual tenants at all. The landlord simply takes out an insurance policy on their property address and then pays for a certain amount of coverage. This coverage usually includes the dwelling itself (the walls, floor, roof, and other fixtures) and the property that the landlord has left within (in the case of furnished units). If there are damages, the landlord can make a claim and be reimbursed.
What Are the Types of Landlord Policy?
A landlord may choose whether they want to secure only their property or also the contents of the property. The contents of the property include things such as refrigerators and other non-permanent fixtures, so this may be necessary. The landlord will also be able to acquire separate fire, flood, and earthquake coverage, which may be necessary depending on area. Finally, landlords can also purchase interruption coverage.
What Are the Major Benefits of a Landlord Policy?
Landlord policies are designed to protect the landlord against damages to their investment — the property. But there’s also another major benefit: interruption coverage. Interruption coverage will pay out a portion of the landlord’s average rental income in the event that the property is not able to support tenancy while damaged.
A landlord insurance policy is generally a necessity for those who do have tenants within their property. Landlords may want to check with their existing insurance to see whether they can be otherwise covered.