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A landlord's place is not in the home, which is why you need a special insurance policy when renting your place out to tenants. Your home is insured but you will still need coverage for the unique situations that arise in the context of rentals, and ignoring this need is a major risk.
Homeowners' insurance policies assume owners live in the home. If the owner doesn't live in the home, then claim coverage can be easily denied. Additionally, your landlord insurance will cover contingencies that do not apply to standard ownership situations, like loss of rent.
First-time landlords should see about adjusting their homeowners' insurance to reflect a new status, showing that the home is being used as a rental. Independently verify your policy to avoid outright claim denials down the line.
If you are buying a property to lease, chances are better that you have already got the right coverage, one indicating your intent to rent out the place (and you may have a buy-to-let mortgage). Remember, however, that you need to tailor policies to your precise situation, so any changes you make on the property need to be reflected in your insurance, and differences between your different properties may require coverage adjustments.
If you add value to your rental by equipping it with great up-to-date appliances, review your landlord policy and make sure that you have covered not only basic structures on your land but assets of value within the home.
Standard landlord policies cover perils like fire, lightning, earthquakes, storms, and floods. But additions can be made to include accidental and malicious damage caused by tenants, legal protection, alternative accommodation costs, contents insurance, rent guarantees, and liability.
Landlords face risks that other property owners do not. By putting your home in the hands of another, you may incur liability for the actions of your tenants. An insurance policy that recognizes this could save you countless dollars should an accident occur on your property for which you and your tenant are found liable.
Landlord insurance policies vary and you need to carefully review yours to make sure that it is appropriate. Not all policies cover all contingencies. To be certain that you have the appropriate coverage, speak to a knowledgeable real estate attorney in your area.
Meeting with a lawyer can help you understand your options and how to best protect your rights. Visit our attorney directory to find a lawyer near you who can help.