Rental Property Insurance

[Therese V.]

My husband and I are shopping around for insurance quotes for our first rental property. Any suggestions as to how much coverage, what we need, how it works?

Thanks!

[Tasha Thomas]

Hi Therese,

I am a licensed insurance agent in Ohio.

The type of policy you need is a dwelling fire policy (this is the type of policy all landlords need for their properties with 1-4 units). As Ali & Kevin said a form 3 is the route you will want to go, which covers most perils (minus flood & earthquake) for replacement cost. Many companies won't do an actual cash policy and the ones that do usually charge you more than what a replacement cost policy would be.

Dwelling fire policies are usually slightly more expensive than regular homeowner's policies, as they are seen as a greater risk to the company. Shop around for quotes and I always recommend an independent agent.

Dwelling fire policies are similar to homeowner's policies in most aspects except that they do not cover (much) personal property - for this your tenant should get renter's insurance and I usually recommend writing that in the lease.

Also, make sure you have a minimum of 300,000 liability and an umbrella policy is also a great idea.

If the house will be vacant for a while you will be looking at a much more expensive and less inclusive policy. Let me know if that's the case and I can go into more detail about that.

If you have any more specific questions I would be happy to help or review any quotes that you get!