If you own a property with tenants living in it, rent out your home, or vacation property this information is for you.
As a landlord renting out a residential property, you may assume your homeowner’s insurance combined with your tenant’s renter’s insurance in Springfield, Ohio will cover all your bases. Think again.
When it comes to natural disasters, accidents, and other damaging events you want to be sure your property is covered. Unfortunately, if your only coverage on your rental property is homeowners insurance you could be left hanging.
Why Do You Need Renters Insurance?
All insurance coverage varies based on your individual policies, but it is likely that your homeowner’s insurance plan only covers owner-occupied homes. This means if someone other than you, the owner, is living on the property the homeowners insurance no longer applies.
Yes, it is also important you require your renters to obtain renters insurance but that still leaves you vulnerable to the damage done to your property through mother nature, accidents on your property, forest fires, storm damage, and other unfortunate events.
This is where landlord insurance comes in.
What Does Landlord Insurance Cover?
Your specific coverage may vary based on your needs. Working with an independent insurance agent at Link-Hellmuth will ensure you end up with a policy that meets your needs at an affordable price. Generally speaking, the following is what you should look for in landlord insurance coverage:
- Property Damage—This is covered in the event that the real estate or furnishings suffer from a natural disaster, fire, electric/gas malfunction, earthquake, vandalism, or irresponsible tenants. If possible, try to get a policy that offers replacement costs instead of the actual cash value.
- Lost Rental Income/Rental Default Insurance —Should something cause your property to be totally uninhabitable (severe mold, termites, or a sinkhole), this feature provides temporary rental reimbursement to cover the rent money you’d otherwise receive if tenants could be occupying the property.
- Liability Protection—This is coverage for the medical or legal costs that might ensue if the tenant or a visitor suffers injury due to a property maintenance issue (such as icy walkways, architectural collapse, or an out-of-control hive of bees).
This basic level of landlord insurance is essential for you to keep your peace of mind as you rent out your properties. For additional coverage as it applies to you, you could consider adding on the following:
- Guaranteed Income Insurance—This covers the landlord if a tenant comes up short on the rent (or doesn’t pay at all).
- Flood Insurance—As many landlord insurance policies don’t include flood damage related to natural disasters or municipal plumbing, this coverage is worth adding if the property is in a flood-prone zone.
- Emergency Coverage—In the event a tenant calls you out to fix something such as a leaking dishwasher or was accidentally locked out of the house, this feature can help cover some or all of the costs you incurred to travel to the property and resolve the issue.
- Additional Construction Expenses—This will cover expenses incurred by having to bring a building up to code after it has been damaged.
The Cost Of Landlord Insurance
The cost of landlord insurance is going to vary case by case. According to the real estate investing site Stessa.com you can expect to pay about 15% more for landlord insurance than you would homeowners insurance. This is because rental properties are more likely to be damaged.
Your cost may also depend on how long you rent out your property. Short-term rentals usually have much higher landlord insurance premiums than long-term rentals.
Working with an insurance agent is going to be helpful when establishing your landlord insurance coverage. Our team at Link-Hellmuth Insurance Agency is experienced in helping landlords find coverage that uniquely fits their needs and supports their real estate investments.
Give us a call today for any questions regarding landlord and renters insurance near Springfield, Ohio.