The 6 Most Important Clauses in a Landlord Insurance Policy

Written on November 13, 2013 by , updated on April 10, 2018

Landlord InsuranceNot all insurance policies are created equal.  In this article, I will discuss the key attributes of a quality Landlord Home Insurance Policy.

Standard property insurance policies assume that the homeowner lives in the property.

Landlords, on the other hand, rarely ever live in their rentals and therefore need a different type of policy – a Landlord Insurance Policy.

In fact, most landlords don’t realize that if they file an insurance claim on a rental, but the policy is NOT listed as a Landlord Policy, the insurer can deny the claim – no ifs, ands, or buts about it.

If your home insurance is not recorded as a Landlord Policy, the insurer can deny the claim.

Did you catch that?  They don’t have to pay!

Why the Difference?

It’s simple really… because there are different risks involved with rentals vs. homeowner occupied properties.

Landlord policies account for typical issues that a landlord might have – such as “loss of rent”.

It also fits under a different pricing structure with the insurance company – and thus the main reason they want to know about your rental.

It’s Easy to Forget…

When people are forced to move, but don’t want to sell their house, the logical solution is to rent it out and become a landlord.

It’s easy to forget to tell your home insurance carrier that you’ve moved, after all, the property is still the same. It’s natural to ask yourself “Why does it matter who is living there if I still own it?”

The fact is, that in order for your existing home insurance policy to fully cover the property, you need to inform your insurance carrier that the property is being converted to a rental, and you are not occupying it as your primary residence.

Your insurance company will then label it as a “Landlord Policy”, and ask you a few questions about the amount of coverage that you might need.

Always Be Prepared

Always Be Prepared

Always Be Prepared

Being a landlord can be a great way to make a living, but it is so very important that you make sure you’re completely covered if something goes wrong – even if the chances are remote.

It’s essential to have the proper insurance policy in order to keep you from unnecessarily losing money or assets that may be impossible to recoup.

Listed below are the most important clauses that you need to consider when creating/converting your Landlord policy.

6 Critical Clauses in a Landlord Policy

1. Dwelling Coverage w/ “Guaranteed Replacement Cost”

Fire Damage

Fire Damage

Dwelling coverage is most basic type of home insurance, and if you don’t own your property outright, your lender will probably force you to have this type of coverage.

Dwelling coverage insures just that, the dwelling. It will protect you against financial costs related to structural damage of your property.

This typically covers structural issues, plumbing and gas systems, fixed appliances, cables and piping, internal fixtures and fittings, and outdoor items like exterior blinds and awnings.

However, you should also consider getting “Guaranteed Replacement Cost” coverage – which will pay to replace/rebuild the property, even if the cost of building materials exceed the amount you were originally insured for.

Dave Ramsey says:

“Several years ago, a lot of the major insurance companies quit offering guaranteed replacement cost insurance—a policy in which your home is replaced no matter what it costs.”

You just have to shop around. Without guaranteed replacement insurance, you will only be covered for the value of your home at the time you took out the policy – which doesn’t always cover the cost to replace it.

2. Water/Flood Coverage

Hurricane Katrina caused some of the worst flooding in US history.

Hurricane Katrina caused some of the worst flooding in US history.

Water and/or Flood Insurance is typically an extra policy which is added to your base policy.

It covers water damage to the building or anything inside is the property. Most basic dwelling policies will cover broken pipes or water heaters, but the extra flood policy is needed in order to cover floods, rains, sewer backups, water issues from natural disasters, etc.

Prices and rates are regulated by the U.S. Government’s National Flood Insurance Program, therefore the cost will be the same no matter who the insurer is.

It’s also a great policy to have if your tenant decides to put a hot tub in the living room.

3. Personal Property Protection (Contents)

Your furnishings need to be insured

Your furnishings need to be insured

Personal property coverage is essential if you’re renting a furnished apartment, but many landlords prefer to have it even if they rent empty units. Contents coverage typically protects you against damage to carpets, curtains, furniture, domestic appliances, household goods, and light fixtures.

While some landlords choose to have contents coverage, not all do. You’ll need to weigh the potential benefit of having the insurance against the monthly cost of the added coverage to know if it’s right for you.

4. Acts of Nature

Tornado Alley

Tornado Alley

Acts of nature include tornadoes, hurricanes, earthquakes, and even riots.

Although some types of insurance may not include all types of coverage – tornado insurance is not something you need in California, but it is absolutely necessary in Kansas.

In some cases, this clause is not included by default and you have to ask for it.

Again, you really have to weigh the pros and cons of each add-on, for example, hurricane insurance is so expensive in Florida, sometimes it’s cheaper to rebuild your house out of pocket than carry an hurricane insurance policy.

5. Fair Rental Income Protection       

roll of money

Your recurring rental income is one of your most valuable assets

Rental default insurance, sometimes known as loss of income, is a type of insurance that allows you to collect the rental amount of the property for a certain length of time if you are unable to do so because of repairs or a catastrophe.

However, most standard Landlord policies won’t cover the lost rent due to an eviction or dead-beat tenants.  The coverage works in conjunction with a damage claim that makes the property uninhabitable.

Allstate’s policy says:

If your rental property becomes uninhabitable due to a covered loss, Allstate Fair Rental Income Coverage can help pay you the rental income you would otherwise lose. In other words, if your tenants have to move out, Fair Rental Income could keep the rental income flowing in for up to 12 months, while the unit is being repaired or rebuilt.

Loss of income insurance might seem like a great deal at first, but it’s important to determine how much your premium will go up for this coverage, and that you weigh the benefits.

If you can self-insure, and can live without rental income for a month or two, paying for years of loss of income coverage may not be a wise financial decision.

6. Legal / Liability / Medical Coverage

Broken bones usually equal lawsuits

Broken bones usually equal lawsuits

If a tenant or employee – even a contractor working on a part-time basis – sues you for damages, legal and liability coverage can keep you from having to go out-of-pocket. This is generally coverage that every landlord should have, as it’s easy to build up huge legal fees or be forced to pay large settlements for things that are largely out of your control.

As with any policy, this coverage has its limits.  If you have multiple rental properties, then you might want to consider getting an Umbrella Policy to cover you and your personal assets if a liability claim goes beyond the limits of your landlord policy.

Most of the time, lenders will require that you have liability coverage, in order to protect their investment/loan.

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138 CommentsLeave a Comment

  • Veena chabra

    I have rental apartment my tenant fell on ice is she covered under my homeowner police

  • NYC MP

    Hi Lucas,
    I unfortunately did not read up on all the tips for being a first time landlord and rented my entire house out for the first time which became a nightmare with constant threats of lawsuit it was a perfect storm of bad luck. I am actually renting where I currently live in a different neighborhood and my rental insurance for this house is the same company for my homeowners insurance. The tenants are now out and I don’t need to make a claim but I want to get the right policy. What should I tell them when they ask me what date is the starting date/when will it be no longer your primary residence? I still have a mortgage on the property and I am afraid of saying “2 years ago” and the bank calling in my mortgage. I am currently in the process of fixing the house and violations with the city agency that the tenants screwed me on so it will not be available for rent for a few months, should I call my ins company now or after construction/violations are cleared? Thank you.

    • Lucas Hall

      Hi there,

      In my experience (with Travelers and Allstate), they want to know the date it was put into service so they can calculate the premium accordingly. Sometimes, they will even backdate it for you.

      If they also insure your primary residence, and it’s noted as such, then they already know that you don’t live at the other place anymore.

      Also, a mortgage company can’t really come after you for moving out. Life happens, and as long as it was your primary at the time you signed the mortgage docs, then you should be okay.

      If you think that your insurance company will send out an inspector, then you should probably wait until the violations have been cured. But if it’s just a matter of switching it from “primary” to “investment” in their system, then they may not care.

      So much of your situation depends on how the insurance company will react. It’s always a best practice to notify them ASAP, because if your house burns down, and they realize that it was filed incorrectly, it could void the coverage, and you’d lose it all.

      Good luck!

  • kelley corbin

    if a house is owned outright and you want to rent it is it the law that you have to have home owners insurance?

    • Lucas Hall

      Hi Kelley

      Though I’ve never heard of this rule, it’s always wise to have home insurance if you rent it out. Otherwise you open yourself up to liability lawsuits which could be in the multiple hundreds of thousands. Each state governs insurance differently so you should check with your state’s dept of insurance regulator. Good luck!

    • Danny

      You are not required by law to have landlords insurance. Also in that same note. I wouldn’t rent my home without it. If someone gets hurt on your property or they demolish your place. You definitely want it to be covered. Also don’t use Allstate they are crooks. Currently I’m fighting them to cover damages that I have been paying for over five years now. Now I make a small claim and they don’t want to cover so steer clear from them. Use an honest company.

      • Cori Borjan

        Danny I agree with you 100%! I had 8 houses with Allstate. After 7.5 yrs. with them, I had to make my first claim. I quickly realized that I was not in “Good Hands” and my loyalty to them was not a 2 way street. It’s horrible having to fight for the coverage that you have been paying for & deserve!

    • David

      My landlord has my ins included in the payment but he refuses to tell me the name of the ins co, how can I prove he doesn’t have ins

  • Leticia

    Hi I have a rental property and tenants moved out and left a junk yard at the house while i was cleaning the back yard rv gate dropped on the back of my leg. I put claim in to my insurance company and they denied me the next day said Iam not covered. Is there a loop hole in the policy?

  • JF

    Hi Mr. Hall,
    I have a situation that may be of interest to others. I am an owner or a rental house and have tenants who announced they were leaving at the end of their lease. I visited the property in the first week of the last month and was not happy with the condition but was promised they were going to get everything cleaned up. In walking out to the backyard deck I was greeted with a cat. The lease does not allow for pets. I was told the cat was a neighbor’s. When I left there was another cat at the front door. I just visited the house again and saw a litter box, scratch post etc… all signs that the tenant did in fact have cats. There was even a slight odor in the house on the 2nd visit.
    What can I do and what approach do I take. Do I wait till they leave and inspect and determine if there is damage, urine odor, and or other issues related to the cats and if so how do I put a price on things.
    Thanks
    JF

    • Lucas Hall

      HI JF,

      Dealing with unapproved pets is tricky. Generally, a lease violation notice can be sent, and the landlord could terminate the lease if the pet is not removed. However, in your case, it sounds like the tenant is leaving very soon anyway.

      If I were in your shoes, I’d probably just focus on getting them to clean well, and I wouldn’t even mention the cat. After they move out, then I would have the carpets and air ducts professionally cleaned and deodorized, and do my best to remove any and all cat dander – so that it doesn’t affect future tenants with allergies.

      I’d spend the extra money to have the place cleaned professionally, and itemize it as “cat reside removal”. Even if the cat was their neighbor’s pet (which it’s not), they still aren’t allowed to let the cat in the house. No pets means no pets. It doesn’t matter who the pet belongs to.

      Then I would send them an itemized list of damages and receipts, and any remaining deposit.

      Here’s an article I did on the topic: https://www.landlordology.com/how-to-rent-to-tenants-with-pets/

      I hope that helps. Please know that I’m not a lawyer, nor is this legal advice.

      • JF

        Thanks for your comments. In the end all of this can be resolved with a little common sense and attention to getting the place professionally cleaned. Obviously had the tenant been willing to discuss this before instead of hiding the pet it would make things a lot easier.
        I am still pondering the difference between asking for higher rent upfront vs resolving problems when the tenant leaves. Can one still ask for additional cleaning expenses after doing the exit inspection if one has charged a higher rent for a pet?
        Thanks
        JF

        • Lucas Hall

          Hi JF,

          That’s what a security deposit is for. If you didn’t collect one, the tenant would still be on the hook for any lease infractions or excessive damages – but you would have to send them an bill and hope they pay it.

          I always collect at least a 1 month security deposit. If that’s not enough for you, collect 2 months worth if your state allows for it.

  • JF

    Hi Mr. Hall,
    Yes, I would always require a security deposit regardless of whether the tenant had a pet but say you had a prospective tenant and they had a pet so you told them to rent with their pet the rent was going to be higher. Your article mentions maybe $200mo higher on average. So the lease now allows for a pet, has a higher rent amount, and there is a security deposit. So when they leave and you have to get the property professionally cleaned, etc… can you deduct that from the security deposit or will they say that the higher rent should cover all that ? What if the carpets are so bad you have to replace them which could easily be more than the security deposit ?
    Many thanks again
    JF

    • Lucas Hall

      Hi JF,

      The higher rent is in no way a deposit against damages. It’s simply the cost to have a pet. The owner is still responsible for any damages – which include the removal of dander and allergens, not to mention any excessive damage to carpets, baseboards, etc.

      If the carpets are so bad that you have to replace them, then you should do so – for the sake of your next tenant. But keep in mind, generally a landlord can’t charge a tenant the FULL price to replace a carpet because the landlord has already gotten some useful life out of it. I go into detail about how to price a carpet replacement in this podcast: https://www.landlordology.com/ask-lucas/010-carpet-damage/

      The fact that they have to pay extra every month for the pet doesn’t offset the damage. Damage is damage, and if their deposit doesn’t cover it all, send them a bill, and take them to small claims if they refuse to pay the excess. Be sure to send an itemized list of damages that lists the withholdings within the required time (per state). http://www.landlordology.com/state-laws

      Please know that I’m not a lawyer, nor is this legal advice.

      • JF

        Thanks again for the guidance, Mr Hall.
        I have another related issue that I would be interested in asking about. Say you have a rental property that is part of other attached units. You are renting to tenants that are young and have a baby. They are in the lower unit. The upper unit is between leases and the owner decides to refinish the floors. That involves sanding, restaining, and a top coat finish. The lower unit tenants complain of a terrible odor when the staining is done. They say they were not informed of the work being done and have to leave the property for a hotel both for concern for the baby and the mother gets headaches. How can this be resolved between the parties?
        Thanks in advance, JF

        • Lucas Hall

          Hi JF

          That’s a tough situation. I’m surprised they didn’t complain during the install and sanding – and I think you lucked out that they only started complaining during the staining process :)

          A landlord is required to ensure the quiet enjoyment of a property. However, a tenant should put up with a small amount of disruption. Whether or not a floor install affects their right to quiet enjoyment is really depending on the situation. I’ve known installers who’ve installed hardwood in 2 days, while the tenants were at work. But I could see how it would be issue when the baby is taking a nap, or if the smell is causing headaches.

          While you aren’t responsible for ensuring absolutely silence (no matter what your tenants think), if the fumes are causing headaches, then that’s a big deal.

          If I were you, I’d increase the ventilation on the upper unit, and do whatever I could to help the stain dry quickly. Then, I might offer to put them in a hotel (max 2-3 nights) if the smell is really bad. But if they are just overreacting (use your best judgement), then maybe you could say “sorry, but it will be over soon”.

          Also, if you are switching from carpet to hardwood, you also might want to consider the increased noise – and as such, require your tenants to cover at least 80% of the new floors with area rugs – otherwise your lower tenants will continue to complain. If you had hardwood before, they should already be used to the noise.

          I hope that helps. That’s what I would do in this situation, but please know that I’m not a lawyer, nor is this legal advice.

          • JF

            Thanks again Mr. Hall,
            Much food for thought on those prickly situation.
            Another area that I find tricky is an end of lease inspection. What is the best advice about viewing things either as ‘damage’ vs ‘normal wear and tear’.
            Things like damaged door screens, gashes in the nosing of wood stairs, scratches in wood floor tend to fall into careless damage and not wear and tear. How about a tenant who refuses to replace a light bulb?
            Thanks in advance

            • Lucas Hall

              Hi JF

              That’s a tricky topic. I usually try to be fair, and air on the side of caution.

              When I’m unsure about some particular damage, I ask myself “would an average person, under average circumstances, create this level of damage?”

              In my opinion, damaged door screens and gashes in the stairs are careless damage, and the tenant should have to pay for it. Scuffs and small nail holes in the walls would be considered normal wear and tear. Scratches in the floor really depend on how severe the damage is. Everyone is going to scratch the floor, but not everyone will cause severe damage.

              Here’s a helpful guide from HUD. The last 2 pages are particularly useful.

              http://portal.hud.gov/hudportal/documents/huddoc?id=HSG-06-01gApp5GUID.pdf

              • JF

                Mr Hall, again Thanks! The reference link had simple and straightforward information with great examples of things.
                This whole area can be contentious and tenants can be quite dramatic in hearing they caused damages, as you know. Can you explain the overall responsibilities between Owner, property manager, and tenants in these decisions of damage vs normal wear and tear. Who can or should be involved with the final inspection? Who has final say on what is damage and what isn’t and Who establishes a reasonable value and what is needed to back it up if challenged? Thanks in advance, JF

              • Lucas Hall

                Hi JF

                If the owner and manager are two different things, then the responsibilities of the manager should be specified in a signed management agreement – which is up to them to negotiate.

                Personally, I think the owner should be involved in every financial decision, and in the selection of the tenants.

                My opinion is that the manager/owner should conduct the move-out inspection, and the tenant is welcome to be there, but is not required to. The manager has final say over damages, and the value of such should be established through actual repair/replacement costs or estimates.

                I only withhold money from a deposit if I have a receipt/estimate to prove that spent the money on a repair. Generally speaking, a tenant is responsible for returning the unit to the condition it was when they moved in (normal wear and tear excepted). A landlord should take pictures of the property before move-in, and after move-out, and have the tenant fill out the move-in inspection sheet within 3 days of moving in. Between the pictures, and the inspection sheet, it will be easy to tell what damage was caused by the tenant.

  • kyle Bognar

    I have a couple of questions living in GA. I rented an apartment and shortly after it was sold and a new owner came in and decided to raise my water bill in the middle of my lease, is that legal? Now they are telling me I need to join their insurance coverage on top of mine which is $100,000 and 30,000 personal injury. Legally can they make me do this?

    • Lucas Hall

      HI Kyle,

      What does your lease say about the water? Is it a fixed-term lease, or a monthly agreement?

      New owners typically need to honor the old lease, but unless you have a fixed-lease with a future end date, you don’t have much protection.

      If you’re looking for legal advice, you’d need to consult an attorney (that’s what they do :)

  • kyle Bognar

    Yes I am in a 6 month lease and looking to renew today for 1 year I just need to know my rights before signing a new lease. They are also telling me I need to add another insurance company on my already covered insurance for a $100,000. I relocated here in March and the biggest reason I moved her because of the low water bill, now changed under different ownership. My lease is not expired until Sept 1st. I can understand under the new signing of a lease but changing it during my current lease I feel is violating my rights

    • Lucas Hall

      Hi Kyle,

      Anytime a lease is up for renewal, the landlord can change the terms and even the price. It seems like a requirement of the new lease is that you get more insurance coverage, and that you have to pay more for water. So, if your lease doesn’t expire until Sept 1, then that’s when the new terms would go into effect. I don’t see how they can them go into effect immediately. Doing so would be against your current lease.

      With that said, sometime a lease will say that the water bill (or other utilities) can change in mid-lease. Sometimes, a landlord puts this clause in there to keep up with the changing utility prices. You’d have to read the lease carefully.

      If you don’t like these terms, you can try to negotiate them down, but at the end of the day, no one is forcing you to sign a renewal. You always have the option to vacate the property and take your business elsewhere on Sept 1.

      Again, I’m not a lawyer, so please don’t take this as legal advice.

  • greg

    I have a brand new house, I have renters coming in August, what else do I need to do to protect myself on the contract , and what kind of insurance for them do I need ?
    Thanks !

  • JF

    Hi Mr. Hall,
    In following this question and your answer I had another question pop up. Say you are attempting to rent a house and the prospective renter likes the place but wants to make some minor changes ( like changing out the carpets, paint rooms, etc ) how does one analyze the offer? Say they are suggesting they do the work ( paint a room). The first question is should one allow changes like this and ask for final review of color and paint quality. Then who pays for what. Do you reduce rent at the agreed to value or what other options are typical? Say someone wants new carpeting, that is a big change and can last a few years. Could you ask for an extended lease of 2 or even 3 years and again who pays for the changes ? Thanks in advance…… JF

    • Lucas Hall

      HI JF,

      Personally, I believe that a tenant should be allowed to make the unit their home. This includes adding personal touches, such as hanging pictures, painting walls, landscaping, etc. But it does not include making major improvements, such as decks, new windows, or even carpet.

      However, all of it can be negotiated. I don’t think that a landlord should pay for improvements just because the tenant wants them. If the landlord is going to contribute funds, the improvements must be timely. For example, if the house (or even just a room), NEEDS to be painted, then certainly you could reduce the rent slightly if the tenant is willing to put in the labor, while you continue to buy the paint. But certainly it should not be equal to the cost of a professional painter – b/c your tenant is not a professional painter.

      If the tenant is a professional carpet installer, then by all means, let him install the carpet and deduct it from the rent. If the old carpet needs replacing anyway, then I suggest you just get it done. Go pick out the type and cost of carpet you want to pay for, and then tell your tenant “I’m willing to contribute $X,XXX to new carpet since it needs replacing. I’m willing to let you pick out the style, as long as I approve it”.

      Remember, it has to be a universally accepted color and style. If your tenant installs red shag carpet, you will have difficulty re-renting the place.

      If they want new carpet, but the old carpet is still in great condition, then the landlord shouldn’t pay for anything. You could say to the tenant “The current carpet is in great shape, and I have no plans to replace it, however you’re welcome to get new carpet at your own expense, but I must approve the color and style, and you must leave it with the house when you leave.”

      You could use the lease terms at a negotiation tool, but keep in mind, it won’t stop them from abandoned the lease if they want to.

  • Karen Schloeman

    Any recommendations for reputable insurance companies that would provide a policy with the 6 important clauses? I think we’ll have to switch from Allstate as they don’t have the replacement cost clause (at least in Philadelphia, where the property is).

    • Lucas Hall

      Hi Karen,

      Try Travelers or State Farm. As you are discovering, insurance products can vary greatly (even within the same company) depending on your location.

      “Guaranteed Replacement Cost” isn’t such a big deal as long as you have an overage rider. For example, I think Allstate will pay an additional 20% if construction costs go above the coverage amount – but you’d need to talk to your agent to be sure.

  • Jo Anne

    I have a rental property with the below insurance. Does this cover “other” structures, similar to a primary residence policy would carry at 10% of policy value?

    Fire, Special Form, Broad For, Liability, Medical

    Thank you!!

    • Lucas Hall

      Hi Jo Anne

      In my policy, “other structures” means sheds, detached garages, fences, etc. You’d have to talk to your agent to know what coverage percentage they are insured for.

  • Lucy Perez

    I rent, storm Erika might be here in Florida as of Monday. Owner of unit lives in Venezuela. Who’s responsability, money wise is it to protect the unit, glass sliding door, first floor unit, and two windows????. If I dont do anything and there is damage, is it my responsibility?. If I buy materials, boards, can I deduct that money from next rent???

    • Lucas Hall

      Hi Lucy,

      This kind of thing won’t be found in the state statutes. But both the landlord and tenant generally have a responsibility to ensure the unit is protected. If the tenant doesn’t take reasonable steps or is just negligent (i.e. leaves a window open during a hurricane), the tenant could be held repsonsible for damage. But if the tenant take reasonable efforts to protect the unit, then obviously the owner would be responsible for any damages due to the storm. Therefore, it’s in the landlord’s best interest to take precautions to such damages – whatever that means.

      Perhaps you could email your landlord and ask him/her for approval to board up the place, and get reimbursed. If you buy those things without getting approval, don’t expect the landlord to pay for it.

      I don’t ever recommend withholding or deducting money from rent unless you get prior authorization.

      I hope that helps. Please know that I’m not a lawyer, nor is this legal advice.

  • Baur Smagulov

    AllState is not renewing my landlord policy due to “vacant or boarded up adjacent property”. My neighbors townhouse adjacent to mine was destroyed by fire. It’s been demolished and scheduled for rebuild. I’m going to repair mine. Still have claim opened with allstate. Can they do this? What should I do? Should I seek for legal help? Hire a lawyer? Can they even do this? I’m not in control of when it will be rebuilt or if neighbors ever move back. Please help.

    • Lucas Hall

      Hi Baur

      Sorry to hear about that. Ultimately if you disagree with their decision, your only options are to seek coverage elsewhere or to seek legal advice. That’s all I can really say.

  • Bonnie

    Years ago title was transferred to me for the home where my mom resides. I notified the insurance company and all they did was change the name on the homeowner’s policy to me. My mother does not pay rent. I just learned about landlord policies and now I’m worried that if a claim did occur, they would deny coverage. Any advice? Thanks.

  • margaret kirn

    Hi, I own a multifamily type home and have insurance on it; i want to rent out a bedroom upstairs..what type of coverage do you suggest?? I want to cover if he or she has a accidnet n breaks bones; ruins walls etc ; negilence with cigarette butts ..meaning in case they start a fire …I do not allow smoking inside at all. / If its started by them what do i do? / What if friends get wild n break things ; destroying house..I live in the other part of house tho its seperated w door n walls. I have ins for flood, reg fire, etc..earthquake also…live in Missouri. Thank you

    • Lucas Hall

      Hi Margaret,

      I would suggest you talk to your home insurance agent about how much coverage you need.

      But I would also strongly urge you to require all your tenants buy and maintain renter’s insurance. They can usually bundle it with their auto insurance and save some money.

      Then, also consider buying an “umbrella policy” from your insurance company. It’s relatively inexpensive and provides a lot of coverage. Good luck!

  • Dracena Trotman

    I am a section 8 tenant,damages occurred which i paid for and as of nov 30th i moved out,i did a walk thru gave her key,she calls me says i have to another walk thru because of additional charges she wants to charge me with like the dishwasher,and dryer ,and leak under the sink ,which was not my fault.We already did a agreement letter tht i will owe her $1000 more i paid 1500$ plus she kept my 1100$ deposit but now she keeps coming up with more stuff to get me to pay more money,and now section8 does not want to get involved in legal issues against tenant and landlord but says i need to do anothwr agreement with her to keep my voucher,so meantime me and my kids is homeless until she write up another agreement what she wants me to pay more.

    • Lucas Hall

      Hi Dracena

      Sorry to hear about the conflict. It sounds like she might be trying to keep your money for normal-wear-and-tear – which is not okay.

      Have you notified the Section 8 housing office? They sometimes have legal advisors to help with situations like this.

  • Deb Diveley

    We purchased a house for our daughter and son to live in. We don’t charge r them rent so when we got insurance from State Farm they told us we’d have to get landlords insurance. A few months later the basement flooded. It took them a long time to send someone. In the mean time I hired a clean up service. When they did come they said we weren’t covered I read the policy we weren’t. A few months later it flooded again but this time it’s from structure damage would this be different than sub pump damage? Thank-you Deb Diveley
    P.s. Clean-up was $3,000.00

    • Lucas Hall

      Hi Deb,

      Generally speaking, your insurance won’t cover the tenants’ stuff. That’s what “renter’s insurance” is for. But it will cover any damage to furniture that you own as long as you have a personal property clause in your policy. The cause of the damage is generally the factor that determines if something will be covered or not. So, you’d have to talk to your agent, and try to determine the cause of the structural damage – which ultimately led to water getting in the house. If the ground shifted, or a car ran into your foundation, or a tree fell on it, then it would probably be covered. If it was because of lack of maintenance, then probably not.

      I hope that helps. Please know that i’m not a lawyer, nor is this legal advice.

  • Jeff Orr

    Back in 2007 I advised Allstate that I was moving south and would be renting my house out. They advised that I needed a Landlord Policy, so I changed it over and paid more for my premium. Only problem is, I had to file a claim 2 years ago, at first I was told it was covered as my ex tenants caused about $23 grand in damages. After talking with Allstate, they sent someone to look at my damages. They called me about 4 hours later and advised that my claim would not be covered as it was not on my policy. I later found that a few years after I obtained my Landlord Policy, Allstate had changed my Policy and requested that I add more coverage. Only problem is, they did not send it to my address where I resided, thus I never received it.

    • Lucas Hall

      Hi Jeff,

      Sorry to hear about the issue. You’d probably have to check Allstate’s communication policy and see what is deemed “valid notice”. If you never changed your address with them after moving, then that might be your fault. Plus, there’s always the option to receive email notices. On the other side, for something as big as a policy change, I think your local agent should have called you. For 23K in damages, you might want to talk to a lawyer (I know I would!). Good luck to you!

  • Pria

    Hi Mr Hall,
    Thank you for all good comments here. I am trying to get into this being a landlord venture and I read that creating LLC is normally safe way to get title of the rental house. However when it comes to finding landlord insurance with LLC as owner, do you know how that works? Does it still get liability coverage? Thank you very much!

    • Lucas Hall

      Hi Pria

      Since the property is still the thing getting insured, I should be possible for an LLC to hold the policy and have liability insurance. It may be a little different since it’s a business and the insurer must match the deed. You may want to consider also getting an umbrella policy to cover all you personally if you have more than one property.

  • Anthony H

    I’m confused a little about the difference between a condo/homeowners policy with the ‘unit-owners rental to others (HO 17 33 04 91)’ endorsement vs an explicit Landlord Insurance policy.
    My situation is a newly purchased _condo_ (I’ll not be living there) that will be rented out. My agent is saying for a condo the homeowner policy is what I need (landlord policy not available?) but the wording of the policy still seems to be based on a premises where I reside even though I’m telling them its 100% a rental.
    Is a condo something special when it comes to Landlord Insurance?

    Thanks for any insight.

    • Lucas Hall

      Hi Anthony,

      A “landlord policy” is really just a standard homeowners policy, or condo policy that includes a clause saying that it will not be home-owner occupied and will be rented to others.

      Many times, a landlord will have personal property in the dwelling that will need to be insured – such as appliances, some furniture, and really anything from the “walls-in” which is what a Condo policy would cover.

      I hope that clears if up for you. The best thing you can do is to talk to an insurance agent to get clarification as it applies to the product they have.

  • L. Pierce

    My apartment complex is now requiring in all new lease renewals, that the tenant pay for their building insurance as part of their lease. Previously, we had to have our own rental insurance in order to move in. Now they are saying that this is no longer a requirement due to them making us pay for THEIR dwelling insurance, whicy by the way, covers absolutely nothing in my apartment in case of fire, flood, etc.

    Even if my apartment is on the ground level, and water happens to come into it and ruins my items (carpet, etc.) it will not cover that either.

    Is it legal for them to make the tenants pay for their building insurance because I still have to have my own rental insurance so that my personal things are covered?

    Thank you

  • Cindy

    My mother passed away and left me executor, I rented the small in law apt to my son. He paid a few rents than quite I did rent out the mane floor and he drove everyone out. He decided to move up stairs without asking me, still not paying any rent and I pay for everything but there is a fire place there that has only been cleaned once in 40 yrs. I am in the process of evicting him. Do I still need to consider it rental property. I’m afraid of a fire and he knows it’s not supposed to be used. This property has been a night mare

  • Lindsay Post

    Hi, my landlord wrote it into our lease that our neighbor (their other tenant) may come into our home to use the laundry. We signed the lease because it’s hard to find a place to live here. But now, I cannot find a company who will provide me with renter’s insurance because of this. My landlords have done nothing to remedy this. I’m worried about my belongings. USAA told me that if my neighbor flooded my place or started a fire from the dryer, they would deny coverage and likely counter claim against my landlord’s homeowner’s policy. They told me I can just move out if I want but I’m on lease until June 1st. What can I do?

  • Lanette

    I’m renting an apartment for my daughter and granchildren I’m scared of any damage that may happen while there living there holes in walls, stain in carpet ,ect there good kids but accidents can happen I’m on social security . I’ve been reading up on rental insurance but I’m not sure if it applys to me . I live in another county and can’t visit as much as I wish I could. It makes me very nervouse my daughter has never let me down

    • Lucas Hall

      Hi Lanette,

      Unfortunately, if you’re the lease holder, you would be responsible for any physical damage that your daughter and her kids cause. Renter’s insurance typically covers the personal property (tv’s, couches, etc), but if you think your daughter might cause irreparable damage, you might want to talk to an insurance agent.

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