Why All Landlords Should Have Rental Property Insurance

Posted by  On September 13, 2021
Why landlords should have rental property insurance

If you are a landlord or are thinking of becoming one, then you need to get rental property insurance (sometimes referred to as rental income insurance or landlord’s insurance). Whether you rent out an in-law suite or a triplex, rental property insurance will help protect your investment.

We’ll explain:

  • What rental property insurance is
  • Why you should get rental property insurance
  • What rental property insurance covers
  • What rental property insurance doesn’t cover

At Archway Insurance, we sell rental property insurance that can include rental income insurance. Rental income insurance is a type of coverage within your rental property insurance policy that helps replace lost income after a significant accident or disaster that requires your tenants to vacate your rental property.

What is rental property insurance?

Rental property insurance protects both your asset (your rental property) as well as the income stream it generates. The income stream part of the protection is called rental income insurance.

Rental property insurance can cover any kind of rental property – from a house to a commercial building – and provides protection for various issues, including property damage and liability coverage.

If your tenants have to move out due to damage and you lose out on rent money, then rental income insurance will help cover this loss. Rental property insurance can take various forms depending on your needs – it can be a separate policy or added to existing ones.

Why should I get rental property insurance?

Rental property insurance offers you two very important things – peace of mind and financial protection. With rental property insurance, you are protected against various claims that could be put against you as a landlord due to negligence or accidents.

In addition, most banks or mortgage lenders will require you to have an insurance policy on your rental property before they are willing to offer you a mortgage.

Another feature that rental property insurance gives you is rental income insurance. If disaster strikes and your tenants move out, they won’t have to pay rent. But you’ll still have to pay the mortgage! With the rental income insurance part of rental property insurance, you won’t have to be in a stressful financial position because you’ll know your lost income is covered.

What does rental property insurance cover?

Rental insurance policies can provide a variety of different kinds of coverage depending on your needs. These are the most common types of coverage included in rental insurance:

  • Dwelling coverage covers the rental building and other structures such as garages and decks from common perils such as fire or wind damage.
  • Personal property coverage is for furnishings in shared amenities such as common areas, a gym or other items owned by the property management. It does not cover the tenant’s belongings.
  • Liability coverage is a critical part of rental insurance. It covers the cost of legal fees and settlements for claims from a third party for injuries or property damage suffered on your rental property.
  • Rental income insurance. Suppose you lose your income stream because your rental property is uninhabitable due to a covered peril (such as a fire). In that case, rental income insurance will cover your lost income for the amount of time it takes to repair the property.

What does rental property insurance not cover?

We’re happy to discuss what isn’t covered by your rental property insurance and let you know if optional coverage is available. Some of the more common things not covered by rental property insurance are the following types of damage or losses:

  • General wear and tear
  • Losses due to creatures such as termites, rats, or raccoons
  • Losses due to earthquakes and landslides (this coverage can be added at an additional cost)
  • Water damage from overland water or flooding (this coverage can be added at an additional cost)
  • Losses due to your own criminal acts

How can Archway Insurance help me with rental property insurance?

You must have enough rental property insurance to cover your rental property’s replacement costs, as well as coverage for the contents of the property. When you come to Archway Insurance to obtain rental property insurance, we’ll:

  • Discuss your rental property and your rental insurance needs with you. We’re happy to answer any questions you may have, including how rental income insurance works. We can also explain to you what factors can impact the cost of your insurance – such as the type of property, how many units it contains, and if the property is currently vacant or occupied.
  • Talk to our insurance company partners to obtain a variety of property insurance quotes.
  • Go through the quotes with you and help you determine which policy would best suit both your insurance needs and your budget.
  • Let you know about any discounts you may be eligible for.

The great thing about working with an insurance broker such as Archway Insurance is that you’ve got choices. You aren’t stuck with just one option or one type of coverage. We’ll shop around to ensure that you get a policy customized to your specific needs.

Rental Property Insurance Is Critical If You’re A LandLord

If you’re a landlord, you must protect your most significant asset – your rental property. The best way to do this is with rental property insurance. We’ve explained:

  • What rental property insurance is
  • Why you must have rental property insurance
  • What rental property insurance does and doesn’t cover

One of the most significant ways rental insurance is different from home insurance is that it can include rental income insurance. With rental income insurance, your insurance company will replace the income you lose if your tenants need to vacate your rental property temporarily.

At Archway Insurance, we’ll shop around to ensure that you get the rental property insurance you need. We’ll sit with you to learn about your rental property and answer any questions you may have about rental property insurance and what it covers.

Contact Us About Rental Insurance

Whether your rental property is in New Brunswick, Nova Scotia, or PEI, we’re here for all your insurance needs. Give us a call at 1-833-536-0529 on contact us online to get started today!

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