When you’re renting a house or apartment, it can feel like you’re taking a risk. But when you’re leasing an investment property such as an apartment building or duplex, it can be tempting to take on more risk than necessary. The good news is that there are ways to protect your investment without breaking the bank. This guide covers everything from what comprehensive insurance is and how much it costs, to examples of which renters might not need to buy rental insurance and which companies offer the best coverage for renters.
What is comprehensive insurance?
This form of insurance covers property you own as well as the occupants of your rental. It specifically covers the structure itself, not the contents of the property. The biggest benefit of comprehensive coverage is that it protects you from fire, theft, and storm damage to your rental property. This means that if a fire breaks out while you’re away or a flood washes away your kitchen, you’ll be protected by your insurance policy, because the fire damage or flood damage would have been covered under your policy. It’s important to note that even if your rental is damaged by something other than fire, flood, or theft, like a break-in or strong wind, your insurance company will still cover the cost of repairs under your comprehensive policy.
Which renters need rental insurance?
If you’re renting out a single-family house, the standard rule of thumb is that you need comprehensive insurance if your house is worth $100,000 or more. This means that if your house is worth less than $100,000, you won’t need coverage. If your rental is worth less than $50,000, then you may be able to get away with not getting insurance. But if your property is worth more than $50,000, then you’ll need to get renter’s insurance. Another factor to consider is whether you’re renting out a one- or two-family house. If you’re renting out a single-family house, you’ll need to get comprehensive insurance, no matter how much the house is worth. If, however, you rent out a two-family house, you may be able to get away with not getting comprehensive coverage. But if your rental is a two-family house and worth more than $50,000, it’s worth it to get comprehensive coverage.
Types of rental coverage
– Collapse: If the building collapses while someone is in the property and they are injured, the person’s insurance will usually cover any medical bills, but the policy will not cover the amount of the damages to the property. – Fire: The policy will cover the cost of the damage caused by fire regardless of the amount of the policy and will also cover the cost of repairs to the property and any loss of personal belongings. – Flood: If the building is damaged by water, the policy will cover the cost of repairs. – Theft: If someone breaks into the rental and steals items, the policy will cover the cost of replacing the items. – Wind Damage: If the building is damaged by wind, the policy will cover the cost of repairs.
How much does rental insurance cost?
The amount you pay for comprehensive coverage will depend on several factors, including the value of your property and the amount of coverage you purchase. The best way to figure out the cost of comprehensive coverage is to call around to several insurance companies and ask them what they charge for coverage of your property value. One way to save money on coverage is to get homeowners insurance with your mortgage lender. While this will cover your home, it will also cover the house and its contents.
Summary
When you rent out a property such as an apartment or house, you need to be aware of the risks involved and what types of insurance you need to protect your investment. The two most important pieces of rental insurance are comprehensive coverage and renter’s insurance. Comprehensive coverage protects you from fire, flood, and theft damage to your rental property. You may also be able to get away with not getting some of these types of coverage if your property is worth less than $50,000 or if it’s a single-family property. – What is comprehensive insurance? – Which renters need comprehensive insurance? – Types of rental coverage – How much does rental insurance cost? – Summary
