How to Insure a Rental Property like an Airbnb or Vrbo

Rental property insurance, also commonly known as “landlord insurance,” is an insurance coverage that helps to protect a home, apartment, condo, townhouse, Airbnb, Vrbo, etc., that is being rented out. You face a variety of risks as a landlord, such as a tenant accidentally damaging your property or suffering an injury on your premises. An appropriate landlord insurance policy can help mitigate those risks.

What does Rental Property Insurance Cover?

Rental property insurance, although similar to homeowners insurance in how it covers the building, helps to account for the increased risk involved in having tenants. Though rental property insurance coverages can and often do vary depending on the carrier and other relevant considerations, there are some typical coverages that can be found in many rental property insurance policies:

• Dwelling

This helps cover the physical structure of your insured property.

• Liability

This can help to cover medical expenses if someone is injured on your property.

• Personal Property

This coverage refers to the belongings you as the landlord leave on site, potentially including items like a lawnmower, a washer and dryer, appliances, and other items you own.

• Loss of Rental Income

This coverage can help replace some of your lost rental income if your rental property has become unlivable due to a covered peril and you are no longer able to collect rent from your tenants.

What does Rental Property Insurance Not Cover?

Just as with any insurance policy, there are exclusions. Be sure to review your policy carefully with your local insurance agent to see what is and is not covered. Some common exclusions include but are not limited to:

• Tenant’s Personal Property

Although renters insurance for the tenant typically covers their own personal property, landlord insurance generally does not cover the tenant’s property.

• Maintenance & Equipment Failure

In most cases, rental property insurance won’t cover routine maintenance issues for things such as normal wear and tear, equipment breakdown, etc.

• Flood Insurance

Typically, most rental property insurance policies do not cover damages caused by naturally occurring floods. Using this flood map from FEMA, you can see if your rental property is in an area that may be at risk of flooding. If so, you may want to contact an experienced insurance agent to discuss what options may be available to you for flood insurance.

How Much Does Rental Property Insurance Cost?

As with any insurance policy, the cost varies due to a wide variety of circumstances and factors. Below are a few factors that may affect your rental insurance costs. These factors may include, but are not limited to:

• The coverage options and deductible you have chosen
• Where your property is located
• How much it would cost to rebuild the property
• The materials used to construct the property
• The age of your property
• Your claims history
• The claims history of the area you are located in
• What, if any, security features your property has in place

To get a picture of how much you may pay, you can request a custom insurance quote from our office. You can fill out our form here, or give us a call.

Is Rental Property Insurance Mandatory?

Although landlords are not generally required to have rental property insurance, it is highly recommended given the various risks that landlords face. In most cases, your standard homeowners insurance policy will not provide coverage for a property that you are renting out. As such, it is a good idea to seriously consider obtaining a n appropriate landlord insurance policy.

How to Save on Insurance for Your Rental Property

Looking to save on how much you pay for your rental property insurance? Obtaining quotes and prices from different companies is a great start. Contact Cross Insurance to start your quoting process and so we can help to provide you options from different insurance companies we represent.

 

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This article is for general informational purposes only and is not to be relied upon or used for any particular purpose. Cross Insurance shall not be held responsible in any way for, and specifically disclaims any liability arising out of or in any way connected to, reliance on or use of any of the information contained in this article. The information contained or referenced in this article is not intended to constitute and should not be considered legal, insurance, accounting or other professional advice, nor shall it serve as a substitute for the recipient obtaining such advice. The views expressed in this article are that of its author and do not necessarily represent the views of Cross Financial Corp. and its subsidiaries and affiliates (“Cross Insurance”) or Cross Insurance’s management or shareholders.