If you’re renting out your investment property, it’s important to have landlord insurance to protect your valuable asset. You never know when accidents might happen, leaving you without the means to collect rent or even rebuild the property. Having landlord insurance can give you peace of mind that the investment will remain viable even during troubled times. Plus, landlord insurance for residential investment properties may be tax deductible.
Who is a potential candidate for landlord insurance?
Anyone who owns investment property that is rented out, even if the renter is a relative is a potential candidate for landlords insurance. Accidents can happen at any time, resulting in damage to your property or injury to someone on your property. As the owner of the property, you’re liable if someone slips and falls on the stairs, for example. If the building burns down accidentally, you’ll want the funds to rebuild again. If your relative decides to leave before the end of the lease and you’re stuck without rental income, you’ll wish you had coverage.
What does a landlord insurance cover?
Landlord insurance generally covers your rental building for:
- Accidental loss or damage caused by you, the property owner
- Vandalism and damage caused by tenants
- Certain defined events. These can vary depending on the insurance company, but often include fire, lightning, theft, storm, and earthquake.
Depending upon the insurance company, the policy may offer complete repair or replacement, or it may only cover up to the dollar amount you’ve chosen.