Arkansas Landlord Insurance

Experts break down landlord insurance costs, coverages, companies, and more.

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Maybe you own a condo in Little Rock that you lease to young couples. Or perhaps you own a house in Fayetteville that you rent out to students attending the University of Arkansas. Whatever your situation, if you own a property that is occupied by tenants, you can benefit from having landlord insurance.

Independent agents can help you find an ideal landlord insurance policy. These agents can provide you with customized quotes from some of the best insurance companies in Arkansas so you can be sure you are getting the coverage you want at a good price. Find an insurance agent near you to get started.

What Is Landlord Insurance and How Much Does It Cost in Arkansas?

Landlord insurance is a type of home insurance policy that is designed to meet the specific coverage needs of homeowners who rent their property out to tenants.   

On average, landlords in the US spend about $1,083 a year on their landlord insurance policies. Your actual costs will be based on factors like:

  • The size, age, and value of the property you are insuring
  • The type of home you are renting out (e.g., single-family detached, multi-family home, condo, mobile home, etc.)
  • The number of tenants living in your property
  • The amount you are charging for rent
  • The crime rate and weather risks where your property is located

For the most part, you can expect your landlord insurance policy to cost about 20% more than a traditional home insurance policy would cost for the same property.

Why Own a Rental Property in Arkansas?

Some residents of Arkansas are able to earn extra income by owning second homes and renting them out to tenants.

  • Percentage of homes that are renter occupied in Arkansas:  34.4%
  • Average market rent in Arkansas: $1,052

Investing in rental properties in Arkansas is a great way to earn some extra money. However, it does have some risks. Covering your property and protecting your finances with a reliable landlord insurance policy increases your chances of having a profitable experience.

Is Landlord Insurance Required in Arkansas?

Whether or not your insurance company will require you to carry landlord or business insurance depends primarily on how you use the property.

  • Long-term rentals: If you have tenants occupying your property for a month or longer, most insurance providers will require you to have landlord insurance instead of homeowners insurance.
  • Short-term rentals: If you frequently rent your home to tenants on a short-term basis, such as if you have it listed on VRBO or Airbnb, you will most likely need to cover it with a business insurance policy.
  • Infrequent rentals: If you have occasional tenants staying in your home for short-term rentals, you may be able to get coverage simply by adding a special endorsement to your homeowners insurance policy.

If you are uncertain about how you should cover your rental property, you can consult a financial advisor or local insurance professional for advice.

How Does Arkansas Landlord Insurance Cover Property Damage?

Landlord insurance is a form of homeowners insurance. All home insurance policies offer structural coverage (also called dwelling insurance) and personal property coverage (also called contents insurance).

With traditional homeowners insurance policies, the contents coverage is usually about 75% of the dwelling coverage amount. As a landlord, however, you will have much lower contents coverage needs than you would if the property was your primary residence.

This is because your tenants are responsible for covering their own personal property with a renters insurance policy. You will only need to cover the structure of the house and any of your own property that is inside it, such as flooring, appliances, and any furniture you may include with the home.

Your policy can cover damage caused by most of the hazards you are likely to face as a property owner in Arkansas. This includes:

  • Severe weather events like thunderstorms and lightning, tornadoes, high winds, and hail
  • Accidental fires
  • Damage accidentally caused by your tenants
  • Property crimes like vandalism

Your policy will not cover:

  • Intentional or malicious damage caused by your tenants: This would require you to file a lawsuit to collect compensation.
  • Flood damage: Even if the flooding is the direct result of a covered storm, the only way you can be compensated for losses caused by flood damage is if you have supplemented your landlord insurance policy with a flood insurance policy.
  • Normal wear and tear: Your policy will pay for damage to your property if it is caused by a covered event, but not if it is a normal part of aging. If your hot water tank fails or an appliance in the home breaks down, you will need to cover repair or replacement costs on your own.

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How Does Arkansas Landlord Insurance Cover against Liability Risks?

Landlords have a significant risk of being sued. If this happens to you, the liability insurance included in your landlord insurance policy can cover expenses like court costs, legal fees, mediation costs, settlements, and judgements.

Some potential problems that can lead to costly liability lawsuits include:

  • Injuries attributed to negligence of upkeep like loose stair treads and unsafe balconies
  • Fires caused by faulty wiring
  • Life-threatening incidents like carbon monoxide leaks

Your policy can provide protection up to your liability coverage limits. If you want to have even more liability coverage than your landlord insurance policy can offer, you can also purchase an umbrella insurance policy.

How Does Loss of Income Coverage Help Arkansas Landlords?

When you own a rental property, you rely on the monthly income it provides to either supplement your income or to cover the property's mortgage payments.

So, what can you do if the property is seriously damaged by a disaster like a tornado, and you are unable to have tenants living in it until it is brought back up to code? This isn’t an altogether unlikely scenario in a state that sees an average of 39 tornadoes a year.

Loss of income coverage, which is another part of your landlord insurance coverage, is designed to help with this problem.

This coverage can reimburse you for your income losses if your property is severely damaged by a covered event, like a fire, and you are unable to have renters inhabit it until repairs are made.

What Else Can Arkansas Landlord Insurance Cover?

As a landlord, you want to be sure that your properties are profitable. Landlord insurance companies want to help. That is why most will provide you with a few coverage options that you may want to consider. These can include:

  • Non-occupied dwelling coverage: Some insurance providers will not honor claims for damage that occurs to a house that has been unoccupied for longer than a month. This coverage can help you be certain that you have the coverage you need when you need it, regardless of your home’s occupation status.
  • Building code coverage: Building codes change over time. If you own an older property, it might not meet the standards for modern buildings. If your property is damaged by a covered event and contractors find that extra repairs are necessary to bring it up to code, this coverage can pay for the additional renovation costs.
  • Guaranteed income coverage: When you rely on your properties for income, it can hurt when a tenant fails to pay their rent. This risk-management product can cover your losses if a tenant defaults on making payments. Coverage can continue for a set period of time, which is usually long enough to complete an eviction.

Independent agents can explain the various coverage options available to you in greater detail. That way, you can be sure that you are purchasing a policy that will protect the investment you have made in your rental property.

Why Let an Independent Agent Help You Find the Best Landlord Insurance in Arkansas?

Local independent insurance agents can help you with all of your insurance coverage needs and can serve as a wonderful resource for information. They are available to offer guidance and advice and can answer your coverage-related questions.

Also, because they are not tied to a particular insurance company, independent agents are free to shop around to find you the coverage you want at the most competitive price.

It doesn’t cost anything to consult one of these experienced insurance professionals. Find an independent insurance agent near you to start comparing customized landlord insurance quotes.

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