Landlord Insurance

There are many different types of landlord insurance, all designed to protect the landlord against loss of earnings and any damage they may incur to their property or contents as a result of renting it out. The cover usually comes under three main categories: building insurance, contents insurance and landlords liability insurance.

There will also be differences between landlords insurance that is designed for buy-to-let properties and individuals, commercial properties or those who have a portfolio of properties. If you do have a number of properties it's likely that you'll receive a discount when it comes to buying your insurance.

Why Do You Need Landlords Insurance?

Since you are using your property as an extra source of income you will need to ensure that it is adequately protected. Since you are taking money for your property, your normal home insurance policy will no longer be valid. You are now going to need a residential or commercial landlord policy to protect your building, contents and earnings as a landlord.

If you have a good landlords insurance policy in place then you will be able to relax in the knowledge that any damage caused to the property will be repaired under your cover. You will never have to worry about incurring large costs that you can't afford.

Types of Landlord Insurance The first kind of insurance you will need to take out is buildings insurance where you will be required to estimate the cost of rebuilding your home should you encounter a total loss. It is important to insure your building for its true value, as you could find yourself losing out if you don't.

Contents insurance can also be taken out. This covers only the contents that are owned by the landlords, and the tenant will need to take out their own contents insurance. This will include your furniture etc. if you are renting out your property furnished.

Other landlord insurance may also cover factors such as your tenant not paying rent. Many of these different types of cover are often included on one landlords insurance package, with contents insurance as an added extra for a small fee. You may also be able to get landlords liability insurance, though this may come as a separate policy.

How Much Will My Landlords Insurance Cost?

There are a number of factors that will determine how much your landlords insurance costs. All insurers will asses you differently, but in general they will take into account factors such as:

- The cost of the building to be rebuilt in the event of total loss.

- The location of the property.

- How many claims have been made in the past.

- How old the property is.

- The type of property.

- The type of tenants living in the property.

LandlordBuddy.co.USA is here to help by providing you with useful landlord insurance information and allowing you to compare landlord insurance and landlord insurance plans.

Why Landlords Should Get Landlord Insurance

Landlords insurance covers you for any loss or damage to your property. For a fixed monthly fee, you can ensure that you are protecting your investment and that you will be able to meet the costs for any work that needs to be done as a result of damages.

The prices of landlords insurance will vary from insurer to insurer, but depending on what you want covered will be a substantial cost each month - the majority of which goes towards protecting the building itself. It is understandable that you may question whether this is a worthwhile investment, which is why we have put together this guide to help you make your decision.

Standard Landlords Insurance Cover

As a general rule there will be different levels of cover when it comes to landlords insurance. You will usually find that an insurer offers a 'standard' option which is basic in comparison to other policies. The major benefit of choosing this kind of cover is that the monthly price isn't huge, but you will still be protected against some of the most important risks that you may encounter as a landlord.

Even basic landlords insurance will usually cover damage to your fixtures and fittings that can happen during a tenancy. If your property is not furnished then you may find that the security deposit paid by your tenant upon moving in is enough to cover any damage to these items.

However, landlords insurance usually goes above and beyond this basic level. For a start, if you are furnished then you will have more at risk when it comes to the potential level of damages that could occur.

Secondly, most insurance packages will cover your building - which is the most important element of the property! The chances are that most mortgage lenders will want you to carry this kind of insurance as a protection against yours and their investment.

More Comprehensive Landlord Cover

Whilst the most basic landlords insurance packages may only insure against damage such as fire, storms, water and so on, more comprehensive insurance plans will protect you from malicious acts committed by your tenants to the property and building.

On top of this general protection, one of the most worthwhile kinds of insurance to have is that where you will be covered from loss of rent. After all, as well as being an investment, your property is now providing you with an income. Should this income cease then it may make it hard for you to continue paying your mortgage, putting you in a difficult financial situation.

Many landlords insurance policies will cover loss of rent should your property remain empty between tenancies. It will also pay for the rent you are losing while taking a tenant to court, or while you are waiting for repairs to be completed. This has obvious advantages and, even if you could pay for repairs yourself, this is the only way you are guaranteed to earn rent. Without insurance you would have to lose earnings for those months.

Points to Bear in Mind

It is important to remember that different levels of insurance will come with different limits as to how much they will pay out. You will also be expected to pay an excess charge on many items. This is why it's so important to read the small print and find an insurance policy that really suits you.

In answering the question of whether you need insurance for your property you should remember that contents insurance will not cover the contents of your tenants. You may also already have adequate cover from your security deposit. However, when it comes to building insurance and cover for loss of rent, landlords insurance can prove extremely worthwhile not only due to the money it will save you, but also for the peace of mind it affords.