Owning one or more rental properties can create additional revenue streams for your family for years to come. However, homeowners insurance generally does not cover business activities that occur on your personal property. That means that if you actively rent out a cottage on your property or a second home, a typical homeowners insurance policy just will not do. Instead, you will need rental property insurance designed specifically to address the increased risks you take on when you become a landlord.
At Giuffre Insurance, we can offer coverage for a wide range of rental properties, including:
- Single-family properties
- Second homes you rent part-time
- And more
Risks and Hazards
Whether you own one property or several, we can help you build coverage that safeguards your financial interests against the risks and challenges you face. These typically include a combination of risks associated with home ownership and those associated with running a business. For example, like your personal home, you invested a lot of money into your rental property that could be lost in the event of a fire or other devastating event. However, you also depend on your rental property for income, which means you could face financial loss if your property becomes uninhabitable due to a covered event.
Types of Rental Property Coverage
Are you prepared for an unexpected loss? Could you withstand a lawsuit or afford to pay for extensive repairs to your rental property? With the right types and amounts of rental property insurance, you can maintain your rental business with minimal out-of-pocket costs, even amid financially challenging circumstances.
Your rental property insurance policy may include coverage for:
Dwelling and Other Structures
This is the coverage that protects your rental property’s structure and other structures against certain types of risks and perils. This typically includes damages caused by fire, wind, lightning, and explosions, although exact coverage can vary by insurer and according to the type of protection you select. Whether you face a total loss after a fire or only some moderate damages due to a fallen tree, insurance can help cover the cost of cleaning up the property, repairing it or rebuilding it with similar materials.
Be sure to talk with your agent about the differences between named-peril coverage and all-risk coverage, as the latter provides broader protection as opposed to the limited loss events covered by named-peril policies. You should also discuss your options for adding other types of structural coverage that may not be covered by your renter’s insurance, such as flood insurance.
If your tenants are injured or fall ill due to a maintenance issue you failed to address, such as mold, you could be held liable for the medical bills and related damages. General liability insurance can help cover the cost of defending yourself against lawsuits, as well as the judgments and settlements against you up to the limits of your policy when you are liable for a tenant’s or third-party’s injuries and property damages.
Loss of Income
It’s always wise to be prepared for the worst-case scenario, especially in situations where you could face a sudden change in income. With Loss of Income coverage, your rental property insurance can help cover your ongoing costs of ownership when a covered event causes the property to become unexpectedly uninhabitable. Examples include the cost of paying bills and maintenance costs for the property when a fire destroys the kitchen in a rental home, forcing the resident tenants to find somewhere else to live.
If you are in the planning stages of building your rental house or duplex, you may need insurance to help protect the property against damages and loss during the construction phase. Construction and builders risk coverage can help pay for damages due to issues like fire, high winds, and more.
Law and Ordinance
Sometimes local municipalities pass laws that require existing property owners to bring properties up to code and make necessary changes before renting the property out. Since these changes are typically unexpected and unplanned for, having law and ordinance coverage can assure you have the money to reconstruct part of the home if necessary.
Your tenants expect a livable environment when they lease from you. If an issue arises with the property, such as a broken air conditioner unit, equipment breakdown coverage helps pay for repair or replacement.
If you keep and store sensitive information about your tenants and applicants, you could face loss in the event your databases are hacked in a cyber-attack. Cyber liability insurance helps pay to inform victims about a breach in their private data, cover the cost of credit monitoring, and help you secure your databases against future attacks.
Flood damages are typically not included in standard property insurance, but you may be able to purchase it as a stand-alone policy. Since flooding causes more property damage each year than any other disaster, we recommend talking to your agent about ways you can add this important protection to your rental properties.
If the limits on your liability insurance are not enough to pay for your financial responsibility for a victim’s injuries or a lawsuit, you may have to pay the remaining damages out of pocket. A personal umbrella policy, however, can extend the liability coverage for a broad range of loss events, including those related to rental properties you may own.
Montello Rental Property Insurance Quotes
If you own one or more rental properties in the greater Montello area, we here at Giuffre Insurance want to help you get the coverage you need to protect yourself against financial challenges and risks you face as a landlord. For more information or to request your free quotes, contact our office today.