I spoke to a group of investors this week. After 30 minutes of discussion, one investor asked, “What is Landlord Insurance”.
The term landlord insurance is not necessarily used by all insurance carrieres. Some insurance companies call the coverage: Landlord Liability, Tenant Liability, Fire Policy, and the names can use varieties of these terms.
Home insurance traditionally covers the “Homeowner”. A Tenant Occupied home requires a new subset of coverages for the “Homeowner”.
To big changes to a policy when converting from “Homeowner” to “tenant occupied” are:
- Liability Coverage… The liability coverage changes from “Family” perspective to “business” liability. The nuances may be slight…
- Loss of Use vs. Loss of Rent. When an Owner occupies a home and there is a “loss”, the owner is displaced and needing funds for staying somewhere. When a tenant occupies a home and there is a “loss”, the tenant is displaced and rent is not paid. The loss of rent is a benefit of the “Landlord Policy”… If your home’s insurance policy does NOT differentiate between to the types of losses, then get the issue defined and MAKE sure you have coverage for “Loss of Rent”.
Landlord Insurance addresses the concerns of Liability and Loss or RENT vs. loss of use.
Give us a call…
Sincerely,
Paul “Matt Locke”
