What People Are Saying
Thanks for making it easy to find the cheapest renters insurance. Knowing our stuff is always protected gives me peace of mind.
Matt and Bethany, Charleston SC
RENTAL HOMES INSURANCE
Rental homes insurance is better known as renters insurance. It is almost the same as the standard form coverage that is bought by people who own the buildings in which they make their homes but is not generally considered an absolute necessity by many people who rent the house or apartment in which they and some of the most valuable people in their lives reside and in which are stored some of their most prized possessions. It offers the same coverage as homeowners insurance, with one or two significant exceptions.
The most noteworthy of these is that rental homes insurance does not cover damage to the physical structure of the rented units whether they be lofts, condominiums, or single family houses. The limits of liability for damage or injury sustained within the rented space are the same as those of an owner occupied property, and that is perfectly acceptable since a renter is to all intents and purposes, also a homeowner.
Many tenants choose not to purchase rental homes insurance however, partly because many people believe that their landlord's homeowners policy provides protections for them. They know that property owners will generally have a policy to protect themselves and their financial assets, and infer from this, mistakenly, that the apartment unit, condominium, townhouse, or loft in which they reside is also covered to the same extent. When leaseholders fail to purchase renters protection it puts the owner at risk for substantial losses. An important part of protecting a rental property investment is to ensure that all tenants purchase renters coverage, no matter whether the tenant is a senior citizen, college student, or family.
It is not a legal requirement for renters, but it should be a standard requirement from owners. Leasing agents and private owner landlords are beginning to require it of their tenants with increasing frequency, and it is becoming standard practice in the rental industry.
Insuring Rental Homes
People who occupy their own homes mostly understand the importance of having coverage against things like vandalism, fire, theft, floods, earthquakes, and other natural disasters, and even then they sometimes choose not to insure their property against the occurrence of an incident with liability insurance for rental property. However, the moment a property owner decides to lease the property, different liability and safety considerations arise. There are, now, commercial considerations and to address this, the major carriers offer special rental insurance policies for landlords that is sometimes referred to as rental homes insurance.
Rental homes insurance, like all other kinds, is bought as a financial safeguard, just in case an accident causes damage, injury, loss, or death for which the property owner is liable. In addition to ensuring some protection against financial losses that could result from the wide range of standard perils and natural disasters, the landlord now has a rental, and therefore a commercial liability. He or she will need to purchase landlords rental homes insurance to protect against the potential losses.
Now that the property is generating income, that income, too, will need to be protected so the rental homes insurance policy will need to include an income protection clause so that if there is damage to the rental and the tenant stops paying rent while repairs are being completed, for example, the landlord will be partially compensated.
Because rented homes are commercial entities, the coverage that the landlord purchases will almost certainly turn out to be significantly more costly than the standard homeowners policy. It will have all the clauses of the homeowners forms, including natural disaster riders. However, it will of necessity contain some that the homeowners policy does not and these will have a cost. Among other things, the personal injury liability limits will certainly be higher than they would have been if the property were owner occupied. The required minimum deductible will also increase. These two factors always have the effect of causing the premium to rise.
The chances of a lawsuit being filed are greater in rented properties than they generally would be in private homes, so it follows that the bodily injury liability also would increase. The landlord could wind up facing legal action and its attendant high fees. If there is appropriate rental homes insurance, the legal fees will be paid by the insurance company.
The most basic form of rental homes insurance covers the standard perils that the landlord will encounter. In order to ensure that coverage is adequate for both property damage and personal injury liability, the landlord would do best to arrange a meeting with a trusted insurance agent to discuss these developments, and to inform himself or herself completely about the riders and additional clause of coverage that would be best suited to the particular rental situation, immediately and as far into the future as can be contemplated.