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Landlord Insurance Cost

Know Your Landlord Insurance Costs

What Costs Affect Landlords?

If you are considering renting out a home or buying a rental property, you are probably wondering, “How much does landlord insurance cost?” It should come as a very nice surprise to prospective landlords that landlord insurance rates can be extremely low, starting as low as $50 per month for required liability coverage.

Your landlord insurance premium cost will depend upon the number of properties you are insuring, the value of the property, how much liability insurance you want to add, and other factors. An agent in the Trusted Choice® network can compare landlord insurance rates from multiple insurance companies and help you protect your property investment. Find a local agent near you today.


Elements of a Landlord Insurance Policy

  • Dwelling coverage for damage from named perils such as fire, lightning, and wind
  • Other structures coverage for garages and outbuildings
  • Landlord liability insurance

Depending upon the insurance company providing your coverage, you can typically choose a standard policy with the items above or a broader policy with coverage for additional risks. For example, landlord liability insurance may be a part of the basic policy or may be an add-on.


Considerations When Purchasing Landlord Insurance

When assembling the components of your landlord insurance policy, carefully review what is included in the basic policy and then determine if that coverage meets your needs. If liability insurance is not included, be sure to consider adding that protection to cover your legal expenses in the event of a tenant lawsuit.

It is important to consider the cost of unforeseen catastrophic problems. For example, if a fire broke out due to electrical wiring, you could be accused of neglecting to maintain the building’s electrical systems and allowing faulty wiring to remain in use.

While you don’t want to buy more insurance coverage than you need, taking a careful look at a range of factors that can impact your rental investment can help you to make an educated choice on your coverage. The cost of insurance is an excellent investment compared to the threat of a liability claim that could force you into bankruptcy.


How to Compare Landlord Insurance Rates

Many new landlords start their comparison shopping by looking for average rates for landlord insurance. Unfortunately there are too many variables for averages to be a simple matter to compute. These factors include the city and state your property is located in, the cost to rebuild your particular property, and the differences between insurance company offerings.

However, you can compare rates fairly quickly once you know what you are looking for. Therefore, the first step in comparing rates for landlord insurance is to decide what you want. As an example, your list of needed coverage to compare might look like this:

  • Replacement cost coverage on all dwellings and other structures
  • Coverage for the following hazards:
    • Fire and smoke damage
    • Lightning, wind, hail, and ice damage
    • Water damage from burst pipes
  • $1,000,000 in landlord liability
  • $5,000 of medical payments coverage
  • Loss of rent coverage in the event that your rental becomes uninhabitable
  • Contents coverage for any furnishings you supply

Bringing your list of needs to your meeting with your insurance agent can help you to make sure that you are doing a direct comparison between similar policies.


What Other Costs Are Involved in Being a Landlord?

When you rent out your home, or purchase a property to lease for rental income, there can be several costs to consider. Make sure you calculate all of the costs involved in becoming a landlord for a full analysis of your profitability.

Additional costs can include:

  • Legal fees for advice from a real estate attorney
  • Upkeep and repairs for appliances, fixtures, paint and carpeting
  • Maintenance of the rental property grounds
  • Property management costs, if you hire a management company
  • Cleaning costs between tenants
  • Lock changes between tenants
  • Property taxes

Because the costs of owning and managing a rental property can add up, it is even more critical to find affordable landlord insurance.

A local agent in the Trusted Choice network can sit down with you to get a full picture of your needs and can compare policies from multiple insurance companies to find the right fit for you at the right price. To get started simply request a quote or find an agent.

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