I have an acquaintance that I’ll call “George”. George was relocated and decided to rent out his property rather than sell. He diligently called his insurance company and purchased renters insurance, signed the paperwork, paid every year, and didn’t give it another thought.
About now alarm bells should be going off in your head. Why?
George just purchased a policy designed for the renters themselves, not the property owner. Asking for a renters policy meant that George was covering (and paying for) the personal belongings of his tenants, and leaving his property totally unprotected.
As a landlord, you are responsible for the property itself. Be sure to get a policy that is designed for the owner, rather than the renter. Your policy should cover the structure itself against fire and hail, for example. And be sure to add liability to it, in case your tenant or a visitor decides to sue.
What type of policy do you recommend? I’ve been going with an umbrella policy for my properties.
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Umbrella sounds good
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Umbrella insurance is very important! It’s great that you have it, just in case there’s a legal issue that comes up. Not likely, but such a claim could be financially devastating. You also need a regular insurance policy. Talk to your insurance company and tell them that you own a property that is rented out, and that you need a basic policy to cover that property in case of fire, hail, water damage (flood insurance is not included in these, that’s another policy you’ll want if flooding is a possibility), and the like. Be sure to ask about different policy deductibles vs. insurance payments. I hope this helps!
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Umbrella insurance is very important! It’s great that you have it, just in case there’s a legal issue that comes up. Not likely, but such a claim could be financially devastating. You also need a regular insurance policy. Talk to your insurance company and tell them that you own a property that is rented out, and that you need a basic policy to cover that property in case of fire, hail, water damage (flood insurance is not included in these, that’s another policy you’ll want if flooding is a possibility), and the like. Be sure to ask about different policy deductibles vs. insurance payments. I hope this helps!
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