Rental Property Insurance Information
Landlord | Rental Property Insurance - Poughquag, NY
Also serving Lagrangeville, Hopewell Junction, Dutchess County and other areas in New York
Do you own rental property in New York? You've got a lot invested in your rental property. Not just your money, but your time. And since an ordinary condo policy or homeowners policy won't cover you, you should consider the specific protection of a rental dwelling policy. Whether you are renting your house, a vacation home or an investment property, rental property insurance is an important safeguard against the financial risk associated with tenants living on your property.
What Does Rental Property Insurance Cover?
Rental property insurance covers the unique risks taken in renting out your home or condo for long periods of time. The coverage includes property damage, liability costs and loss of rental income for landlords renting their property.
Similar to homeowners insurance, rental property insurance covers physical damage to the structure of your rental property, whether it be a home or apartment. For example, it will cover damage to your walls and your roof. It does not include personal items of the tenant. The tenant needs to insure their personal belongings with a renters policy. Coverage only extends to damage caused by a covered peril such as fire or lightning. Consult your policy and your agent for which perils are covered and which are not covered.
This coverage will protect you from the legal and medical costs associated with someone being injured on your rental property. If your tenant or a visitor is injured on your property, and you are deemed responsible for the injury, rental property insurance can cover these costs up to your policy limits.
Coverage for the Landlord's Personal Property
Rental property insurance does not cover the tenant's personal property, but it does often include coverage for items left onsite by the landlord. For example, if you left a lawnmower at your rental property and it is damage by a fire (which is a covered peril), then the damage to the lawnmower would be covered by your rental property insurance.
Loss of Rent Coverage
This coverage provides against lost rent payments if the property you rent is uninhabitable due to a covered peril. Coverage will generally extend to a defined period of time, such as 12 months. This coverage does not always come standard with your rental property insurance, so check your policy before purchasing if this type of coverage is important to you. We will make sure that you have this important coverage.
Common Additional Endorsements
The coverage provided by rental property insurance will vary by insurer, and coverage that is standard with one insurer may be optional with another. Here are a few examples of common endorsements you may be able to add to your rental property insurance. Pepe Insurance Agency will shop quotes to find you the best combination of price and coverage that fits your needs.
- Vandalism coverage: usually covers deliberate physical damage to the home.
- Ordinance or law coverage: This covers a loss of value or costs associated with enforcing local laws surrounding the repair of property caused by an insured loss.
Types of Rental Property Insurance Policies
Rental property insurance is categorized as Dwelling Policy, or DP. There are three forms available to you as the landlord.
DP-1: Usually only covers named perils. If a peril is not explicitly stated in the form, you will not be reimbursed for damage.
DP-2: Similar to DP-1, but provides slightly broader coverage with extending to a broader range of perils.
DP-3: Provides the broadest range of coverage and is an open-perils policy. This type of policy will provide extensive peril coverage, protecting against all perils except those explicitly excluded in the policy.
Do You Need Rental Property Insurance if you have Homeowners Insurance?
It depends on how long you intend to lease the property. In most cases, homeowners insurance coverage will not be an appropriate substitute for rental property insurance. The presence of tenants in a rental property brings on unique risks that won't be covered by homeowners insurance
For long-term renting of an investment property such as an apartment complex, vacation home or a second home in which you intend to rent to tenants, you will need to purchase rental property insurance. Compared to being a live-in homeowner, having a rental house increases your exposure to certain risks such as liability issues relating to tenants and their guests. Your homeowners insurance won't cover these risks under a homeowners insurance policy unless you are residing in your home.
For frequent short-term renting to a variety of people, your property would be considered a business, and you will need to purchase commercial property insurance. In this case, neither homeowners insurance nor rental property insurance will cover you.
For infrequent short-term renting such as for one week or a few weekends during the year, your homeowners insurance will most likely cover you. Before you commit to renting, you need to consult your policy and us for advice.
As a landlord, you need to be aware that your homeowners insurance policy does not protect your rental property. It is important to also carry rental property insurance. Pepe Insurance Agency will help you select the best possible rental property coverage available.
How Much Does Rental Property Insurance Cost?
Rental property is more expensive than homeowners insurance because of the additional risks posed to a landlord over a live-in homeowner, such as the potential loss of rental income and the injury liability posed by tenants and their guests.
Bottom Line: Pepe Insurance Agency is here to help you understand your landlord policy, help you choose the best coverages that fit your needs and work within your budget. Give us a call or request a rental property / landlord quote today!