Landlord Insurance - How much?

[Account Closed]

What is the normal amount of insurance to have for a Single Family Residence in CA?

This is my first time looking and I am getting a ton of options.

Guidance from someone with rental property would be greatly appreciated!

Thanks,

Pam Bivans

[Parker Cox]

@Account Closed There are a few variables here that determine the answer that best suites your scenario.  

First: do you have more than a few 1-8 rentals? 

if your answer is no, you should have no problem getting a landlord fire policy through your current homeowners insurance carrier and then your existing liability coverage will extend and you can add an umbrella for extra coverage on all the properties' exposures.  

if your answer is yes you should get a commercial policy that will cover your properties. Its a little more detailed than a homeowners extension, but it will provide you with coverage that is far more scalable as well as the option of listing an LLC or business entity as an additional insured. This policy is for those of us who are viewing their investing less as a hobby and more as a business and you can start it that way even with only one property if your goal is to grow long term.

Now, to address your question: How much insurance?

well that depends on your house: you should be insured for somewhere between $150 and $250/square foot for your dwelling value (using really broad numbers here, but whatever it would cost to rebuild is the goal).  Then as a landlord, do you have your own furniture, appliances..etc? if so you need contents coverage that adequately covers the cost of replacement on your items as opposed to your tenants.  Finally, you will want a loss of income endorsement: this will pay you for the lost rent during a time when damage from a covered loss means a tenant can't live there: it can come in increments of 6 or 12 months or longer.  

Without having more information, that is the basics.  There is more details depending on the home, HOAs, condos, renters, mortgage requirements...etc 

Feel free to PM me if you have any questions or would like any advice picking an agent or carrier.  

Best, of Luck.  And remember when it comes to insurance, cheapest is rarely the best, but the same goes for the most expensive.  Make sure your agent can give you a full outline of benefits and gaps before you settle for cheap or pay to much.