What Insurance Is Needed When Dealing With Home Rentals?

Real estate is a great investment, especially for rental property owners. 

Yet these properties require home rental property insurance that is somewhat different than typical homeowners insurance.

Before renting either long-term or short-term, it is advisable that property owners discuss their plans with a home rental property insurance agency that can advise them on obtaining the best coverage for their dwellings based on how they will be used. 

Home Rental Properties – Standard Homeowner's Policy

The first detail that rental property owners should recognize when seeking home rental property insurance is that there are two types of policies that might apply depending on how the home is used.

Homes that are a primary residence and only rented occasionally and only short-term are typically covered under the standard homeowner's insurance, though the insurance company might require homeowners to purchase a short-term rental endorsement or some other supplemental coverage.

These endorsements provide additional liability coverage and other protection for a home that is usually occupied by the homeowner. 

Home Rental Properties – Landlord's Policy

On the other hand, properties that are not the owner’s primary residence and are used mainly for generating income typically fall under a landlord policy sold by a home rental property insurance agency.

Landlord policies provide not just damage coverage for the building while it is being rented out but also covers additional concerns like loss of rental income when repairs are being made, temporary housing for tenants during those repairs, and provides general liability coverage to the property owner as well. 

Levels of Landlord's Policy Protection

Landlord policies sold by a home rental property insurance agency are available in three levels of protection, DP-1, DP-2, and DP-3, each one providing protection against additional named and unnamed perils and paying higher benefits when damage occurs.

Additionally, some home rental property insurance companies offer a variety of supplemental policies that long-term rental owners can improve their coverage with such as emergency assistance coverage for immediate maintenance needs, water damage coverage, renter default insurance, eviction expense reimbursement, and others.

Umbrella insurance is also recommended for landlords who rent properties at any time for the added liability and damage coverage it provides. 

Be Sure Your Home Rental Property Is Protected

In short, whether renting short-term or long-term, homeowners must purchase protective home rental property insurance that will cover them based on the different situations.

Short-term rental of primary homes usually requires the addition of a short-term home-sharing endorsement.

Long-term rental of properties should be protected with one or more landlord policies.

Talk to an experienced home rental property insurance agency to put together the right insurance plan based on how a home property is used!