Investing in properties to rent, manage, renovate, and sell can be a wise way for homeowners to generate additional income. However, without the proper insurance coverage, these properties can potentially lead to lawsuits that put homeowners’ other properties and assets at risk.
At Weed Ross, we understand the importance of protecting your investments, and we’re here to guide you in choosing the right insurance policy for your investment properties. Below, we cover five key tips for you to keep in mind as you search for the perfect property investment insurance coverage.
In this article, we’ll cover the following:
- Purchase the Right Type of Property Investment insurance
- Select a Property Investment Insurance With the Proper Coverages
- Lower your Premium With Extra Property Protections
- Understand the Differences Between Landlord and Renters Insurance
- Talk to Your Local Insurance Agents to Purchase Landlord Insurance
Purchase the Right Type of Property Investment insurance
When it comes to investment properties, the type of insurance you need depends on the properties you acquire. If you’re buying a home to renovate and sell without plans to rent it to residents, a separate home insurance policy may suffice alongside your current coverage.
However, if you’re renting the property to residents, as is often the case with investment properties, you’ll need a landlord insurance policy. This type of policy is usually required for investment properties and provides coverage for property damage and liability damages to residents.
Select a Property Investment Insurance With the Proper Coverages
If you opt for landlord insurance, it’s essential to consider the coverage types included in your policy. While numerous types of coverage may be available, the most crucial ones are dwelling and liability coverage.
Dwelling coverage protects you against costs related to property damage in the event of a disaster. The coverage level can range from basic “perils” like fire or theft to more comprehensive coverage that includes protection against earthquakes, tornadoes, and floods. Depending on your property’s location, you may want to invest in a more comprehensive coverage policy.
A liability policy covers physical injuries to residents and their guests that occur on your property. Without adequate coverage, you could be held responsible if they sue for damages.
Additional coverage options may include rental income protection, which covers a portion of lost income due to uninhabitable conditions, and personal property coverage, which protects personal property you provide for your residents’ use.
Lower your Premium With Extra Property Protections
You have some control over the amount you pay for your landlord insurance premium. Insurance companies may offer discounts if you can demonstrate that you’ve taken measures to protect the property, such as installing fire sprinklers and other safety systems like flood lights, deadbolts, or security systems. Additionally, maintaining the property’s upkeep can potentially save you money on your premium.
Understand the Differences Between Landlord and Renters Insurance
One significant difference between landlord insurance and renters insurance is that landlord insurance does not cover damages to your residents’ personal property. It’s important to encourage your residents to purchase separate renters insurance to protect their belongings. For added security, you may even want to require proof of renters insurance when leasing.
Talk to Your Local Insurance Agents to Purchase Landlord Insurance.
While many insurance options are available for landlords, working with the insurance company you already have policies with may help lower your premium. However, not all companies offer landlord insurance due to the significant financial risks associated with investment properties. Reach out to your friendly, neighborhood insurance agents at Weed Ross as soon as possible to determine if your provider offers landlord insurance or if you need to explore alternative options.
Still have questions on property investment insurance? Don’t hesitate to contact Weed Ross to discuss your options for safeguarding your assets. We can help you navigate the complexities of property investment insurance, taking into account factors like property type, location, and strategies to lower your premium.
Contact Weed Ross today to ensure your investments are well-protected. Our knowledgeable and friendly team is here to assist you every step of the way.
