homeoner insurence or Non-owner occcupied landlord insurance???

Question

How are you, my name is Juan. I was reading some post and I just read something that made me believe I might be wrong about the insurance I got. I have a rental property in Indianapolis, and I just get a homeowner insurance, with a high liability, but now I read that what I should do is to get a Non-owner occupied landlord insurance. I had no idea. Should I cancel my current policy and get that type of policy? Are they very different or would be better to get both?. I am very confused about this right now. I hope someone can really put some light into what the people who are landlords and in the business of rental property really do.

Thank you so much to anyone who take the time to write and give some help.

Irina Belkofer · Answer

If it’s a rental, the homeowner insurance won’t pay you because you don’t live there.

You need to cancel that and replace it with landlord insurance.

Your Tenants must have their renters insurance as well.

BTW, not occupied house is not getting insured

You have to talk to your agent in details, even if you miss some details about rental, you can be denied in claim.

Ric Ernst · Answer

@Juan T. you need to let your agent or broker know you are a landlord and not a homeowner occupying that particular house. If your house is vacant / not currently rented, they need to know that as well and will charge a slightly higher premium. Once you have a tenant, you simply let your agent know and they will amend the policy. The rates generally go down. Also, if you are using a PM, make sure you add them as "additionally insured". There is no extra cost for this.

Theresa Harris · Answer

The agent you spoke to shouldn't have given you home owner's insurance for a rental, assuming you told him it was a home you owned and rented out.  Rental insurance (not renter's insurance) is less expensive, at least where I am, because it doesn't cover contents since they belong to the renter.

Colleen Esposito · Answer

A home insurance policy is for an owner occupied property; depending on the company you can insure 1 to 4 family properties on an HO3 or HO5 class policy if you live in it.

If you do not live in a property, you need a landlord policy -  DP3 class policy with replacement cost coverage is normally best - for 1 to 4 families.  If the property has more than 5 families it is an apartment and would require a business policy, not a DP3.

Home insurance is generally less expensive than landlord insurance because it is assumed that an owner living in a house will maintain it better than one that is rented to others.  If you have home insurance in a situation when you should have had a landlord policy, a company may deny a claim.

We've posted some information for landlords on our website: https://www.espositoins.com/blog/

Mark Jones · Answer

@Juan T. some insurance companies won’t even write policies on a rental property. If yours is one of these and you had a claim, I’m sure they’d deny the claim. As someone else mentioned, with a rental policy you are not covering the personal contents in the structure. Another biggie is that a good rental policy will cover your lost rent in case the unit is uninhabitable due to an allowed claim. Get a rental policy.

Anthony Gayden · Answer

I found that I save money by switching to a landlord policy. As my insurance agent says, they do not need to cover the loss of personal property for the tenant which makes the policy cheaper.

Mark Brown · Answer

@Juan T. You definitely need a landlord policy because an insurance company might deny coverage on a homeowners policy because you don’t live there. But beware. Most “DP-1” landlord policies only cover about 10 things. It’s a named peril policy whereas homeowners covers everything that’s not explicitly excluded. Landlord policy only covers like 10 basic things, that’s it, and water damage (like from broken or leaking pipes, hvac issues, and water lines) is not one of them. but some carries let you buy this additional coverage. So you need to ask your agent to find you a landlord policy that includes an endorsement for water damages.

homeoner insurence or Non-owner occcupied landlord insurance???

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