Rental dwelling insurance protects landlords and tenants from damage due to fire, flood or theft. A landlord insures his tenant’s personal property like furniture, appliances, clothing and pets. In case of a disaster, the landlord can get his possessions shifted temporarily. But he has to pay for it himself. A good policy not only covers the rent, but also compensates for any medical expenses incurred by the tenants.
There are two types of Rental dwelling policies – named perils and non-named perils. Named perils covers only those personal property which has been damaged or stolen in the premises. So, in the event of fire, flood or theft, the policy will pay for the lost personal property. Non-named perils covers only those perils which the policyholder has authorized the company to cover. It means the policy will not compensate for fire or theft. It covers only specific risks which the policyholder has authorized the company to deal with.
When you buy a rental property, you should check if the policy covers both the personal property of the tenant and the rental income you earn from it. The policy may state that the rental income is only fifty percent covered by the insurance. This means that if you have to replace your personal property during the period the policy is in force, you will be paid only fifty percent of the total rental income. If you want to earn more rental income, you should increase the coverage on your policy. You can discuss the matter with your agent.
Different insurance companies have different kinds of Rental dwelling insurance policies. Here are some examples. A standard policy may come with a named perils clause which states that the owner is responsible for damage done to the structure and the personal property of the tenant due to water, fire, theft or vandalism. Also, the policy may include a public liability clause which covers your liabilities to other persons affected by your premises due to the effects of weather, fire, explosion or lightning. If the tenant faces any injury while on the premises, the policy will also provide for payment of medical expenses.
Some landlords also include specific coverage in their rental property policies. This coverage usually covers your legal expenses if you are sued by a tenant for an accident on the rental property. You may also be covered for your legal fees if you are sued by someone who claims damages for an accident. You may also be covered for property damage that is caused by smoke, fire, flood or vandalism. In case of theft, your landlord policies will also cover loss of rental income resulting from the sudden cessation of the rental property.
There are two kinds of landlord dwelling insurance policies-the term and the short-term rental insurance. The term insurance is valid only for as long as you own the rental property. When you decide to end your rental contract, the insurance company will terminate your policy. A short-term rental policy, however, will continue to be valid until the end of the contract period.
Most landlords’ policies provide coverage for the personal property of the landlord, such as furniture, fixtures, China, appliances, jewelry, clothing and glassware. Some of the more popular items insured are computers, entertainment systems, jewelry, sports cars, boats and RVs. Depending on the value of your actual cash value, your policy can also provide coverage for some intangible property such as brand name merchandise. If the property you own is located in a building that is rented on a daily basis, you may also want to consider getting a double-guaranteed dwelling policy which will cover the risk of a claim from a tenant who suffers a burglary or fire in your rental property.
You should check with your local property damage and casualty insurance company before purchasing your landlord insurance. They will be able to give you an idea of what coverage is covered under your policy and how much the premiums will be. In most cases, there is a limit on the amount of money that you will be compensated for a covered loss. You will want to discuss this with your insurance agent.