One of the goals of every rental property owner is protection. Protecting yourself, your rental property, and your future goals from potential loss. It’s the whole idea of planning for the worst and hoping for the best, right? The challenge, however, is knowing exactly what to plan for. This is where the big question comes in: what type of insurance do I need for my rental property? Having the right coverage is crucial for keeping you, your rental, and your goals protected. While we can’t advise you on the best coverage options (we’ll leave that up to your insurance agent!), we can provide a breakdown of different types so that you can consider which suits you best. Just make sure to discuss all your available options with your insurance agent.
3 Types of Insurance Every Landlord Should Consider For Their Rental
Landlord or Investment Property Insurance
Did you know that your regular homeowner’s insurance typically doesn’t cover damages if you rent your property? This is because there are different risks involved with renting a property than using it as your primary residence. For that reason, rental property owners should have a Landlord’s Policy or Investment Property Insurance in place. Landlord’s insurance or Investment Property Insurance are specifically designed to protect against loss or damage to a rental property and are geared towards protecting you and your rental from the liabilities involved in renting out the home. What they don’t cover, however, are the tenant’s personal belongings, which we’ll talk about next.
Renter’s Insurance
Renter’s insurance is exactly that: insurance that covers the tenant’s belongings in the event damage occurs. It doesn’t cover damage to the property itself but does come in handy in the event items are damaged from flooding or other covered incidents. Renter’s insurance policies may also cover liability-related instances, such as if someone trips and falls, or negligent acts by the tenant, such as leaving the iron on. The important note here is that Renter’s Insurance should not be seen as a catch-all for the landlord in the event damage occurs. You’ll need your own policy for the property itself. Requiring tenants to obtain renter’s insurance is just another safeguard to protecting you and your property, as well as the tenants themselves.
Liability Insurance
Liability Insurance Liability insurance is another type landlords need to consider for their rental. It covers incidents that the typical Landlord’s policy may not include, such as theft by the tenant, vandalism, loss of rent, and sometimes legal expenses in the event an eviction becomes necessary. Landlord’s insurance covers the physical part of the property. Liability Insurance covers the financial part as well. Both are equally important for adequate protection of your rental property.
Plan for the worst, but hope for the best. It’s an important strategy when ensuring that your biggest asset is properly safeguarded on all fronts. Make sure you have the right coverage in place for your rental property to ensure you, your rental, and your tenants are protected. Reach out to your insurance agent about your options. When you’re ready to add the additional safeguard of property management experience and expertise, Real Property Management Colorado is only a phone call away! Contact us today about our property management services and how we can help ensure your property is both protected and profitable.
