Homeowners Insurance vs Landlord Insurance

[Justin Thompson]

Hey all!

My brother and I just bought our first investment property in St. Louis, MO. The Multi-family home has 3-units that are all currently being rented out. Seeing as this is our first investment property we want to make sure that we do things the right way and not overpay for insurance.

My question to you all is what would you recommend (companies, types of coverage) to use? I have called to get quotes on landlord insurance and the rates seem to be very high. Would you recommend going with just basic homeowners insurance (which seems to be cheaper)? And a follow up question to all of this is what is the average monthly cost of homeowners/landlord insurance?

We thank you all in advance for any advice you give us.

[Ned Carey]

@Justin Thompson Welcome to BP.

if you buy Homeowners insurance you will have no insurance at all. You are not a homeowner. It is a rental property. You need to get insurance for rental properties. Yes it is more expensive. That is part of the cost of doing business. 

If you had a house on a side of the mountain that got very little rain; would you say lets get flood insurance because it is cheaper than fire insurance?

We typically pay $700 a year per townhouse 1200 sq/ft~