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Renting Out Your House? Which Insurance Policy Do You Need?

for Bradenton, Sarasota, Lakewood Ranch and Beyond
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Apr 16, 2015

Renting out your home can be a great way to earn extra income, but it comes with extra risks. Make sure you are protected with the right insurance policy—in most cases, your homeowners insurance won’t be enough.

How Often Will You Rent Out Your Home?

The first thing to consider when choosing an insurance policy is how often you’ll be renting out the home. Consider the following situations:

Short Term Rentals

Occasionally Renting Out Your Primary Residence

Some people may want to rent out their primary residence for a week or so during the year while they go on vacation. In this situation you may be able to add coverage under your homeowners insurance policy—just be sure to contact your insurance agent before you find renters.

Regularly Renting Out Your Primary Residence

If you plan to rent your primary residence out on a regular basis—for instance, every weekend—you probably need business insurance. 

Long Term Rentals

Renting Out Your Secondary Residence

If you own a second home, or if you aren’t currently living in the home you own, you may decide to rent it out for 6 months to a year. In this case, you’ll need to invest in landlord insurance.

(Source: Insurance Information Institute)

What Does Landlord Insurance Cover?

Landlord insurance is less common than other insurance policies, so here’s an overview.

Landlord insurance will not cover:

  • Normal damage caused by tenants—If your tenants scratch up the paint on the walls, stain the carpet, or break the refrigerator door, don’t rely on landlord insurance. In this situation, a security deposit should cover the damage. Landlord insurance covers catastrophic damage—if the tenants start a fire, or leaves the sink running and floods the whole house, then landlord insurance comes into play.
  • Damage to tenant’s property—Landlord insurance will not cover damage to tenant’s property if there is a fire or flood or other catastrophe. Instead you should require your tenants to get renters insurance, which will protect their personal property.

Landlord insurance will cover:

  • Damage to your home and other structures on the property caused by fire, flooding, storms, or other catastrophic events.
  • Damage to the owner’s property stored onsite.
  • Liability due to injuries sustained in the home by renters or guests of your renters.
  • Loss of income if the property is unexpectedly unable to house tenants.

Anyone renting out his or her home for a long period of time should purchase landlord insurance. Renters are less invested in protecting your home and may behave recklessly or forget to report maintenance issues. Protect yourself and your home with a landlord insurance policy—it is worth the investment.

Bradenton Insurance

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