Homeowners / Landlord Insurance Questions

[Tiffany S.]

I am in the process of purchasing my first rental property. Need some recommendations for insurance policies. I am trying to get some simple quotes online and I am not having any luck. Property is in Hampton roads. Norfolk. 

[John Mocker]

Tiffany,

Lynn's advise to start with your current agent is good.  As she explained, some companies will not write the rental unless they write your current home.   It would be a good Idea to also check with one or more independent agents and get comparisons.  I you have USAA or similar (Geico, Nationwide, State Farm,...) the agent may be limited to only what that company offers. 

Assuming that the Rental is a 1 – 4 family house (not in the rehab process) the policy you want is a Dwelling Fire Policy (individual companies may call it something different ie Landlord policy).Some of the things you need to insure:

- Liability (I recommend maxing this - $500,000 is max in most of our carriers but some go to $1mm)

- Medical Payments (Pays w/out determining fault - most carriers will max out at $5,000 but some go higher)

- Building (Look for "Special Form" coverage and Replacement Cost.)

- Contents(for the contents you include in the rental such as Appliances, Funiture, etc.)Look for "Special Form" & Replacement Cost as well for Contents

- Loss or Rents/Business Income (limit should be greater than your 12 mos. of rental income)

- Loss Assessment (if you are in a homeowners association you should look at this coverage)

The things to watch out for/avoid from an Insurance perspective are:

1. Homes with Underground tanks (in use or not)

2. Homes with Lead Paint

3. Homes with Knob & Tube or Aluminum Wiring

4. Homes with Fuses or under 100 amp service

5. Homes with Flat Roofs

6. Homes with Pools that are not fenced or that have diving boards or slides

7. Homes with prior losses (they will show up under a CLUE report of the prior claims)

    May not affect the new policy if over 5 yrs old or was due to Catastrophe

8. Homes with EFIS siding or Asbestos shingles or siding

9. Homes with Polybutylene Plumbing

10. Presence of Asbestos (pipe wraps, tiles, etc.), Radon, or other environmental issues