More and more people are starting to embrace the opportunities for investment that the real estate market can offer today. Whether you are looking to purchase a property to rent out or purchase a property to flip and sell for a profit, there is one aspect of the investment property process that should not be skipped.
While investment properties present great opportunity, they also present great risk. For this reason, you should always include a home insurance policy when purchasing an investment property.
This additional cost or expense in your investment process can be hard to swallow, but at the end of the day, could end up saving you money in the long run. Here is what you need to know about Home Insurance in Springfield, Ohio and investment properties.
Insurance for Your Rental Property
If you own a home or building that you rent out to tenants and receive rental income from, then a form of landlord insurance would be a great option for you. We say a great option because it is not required by law, however, it is common practice in the rental property industry.
Landlord insurance will help cover damages done to the building, home, or structure itself. Through this insurance coverage, you are protecting the asset you own which is the building but not the belongings inside, which are owned by your tenant.
Your tenant would then be required to purchase renters insurance, which will cover what’s on the inside of the property, including their belongings. It is important to be sure your tenants understand you are not liable for damage or theft of their belongings. As a landlord, you should always require that your tenants have renters insurance.
Landlord insurance can also help cover expenses should a tenant choose to sue for any multitude of reasons.
Insurance for Your Home Flip
When purchasing a home to flip, it can be tempting to skimp on the insurance coverage for the time you own it. It can actually be harder to find coverage for vacant properties such as a home flip. This is a necessary step, however, to protect the hard work and money you are putting into a home.
Luckily, at Link-Hellmuth we work with a niche market company that specializes in providing coverage on investment properties. These insurance packages cover the property for the amount you purchased it for, plus an additional coverage amount for all of the equity you’re putting into the home with renovations and improvements. If you’re spending hard earned money on investment properties, make sure you have adequate coverage and are protecting your assets.
While you may not need or utilize homeowners insurance in the same way for your investment properties as you do for your own personal home, it is still an important and necessary step. The benefits of purchasing home insurance for all properties you own will minimize your risk as a home flipper or landlord, and ultimately help your investment be a success!