Tampa and Brandon Investment Insurance Experts Share Tips on Protecting your Investment Property
If you own investment properties, you will want to make sure you have the right insurance coverage for your situation. Property insurance can protect you from property loss and liability lawsuits, and is an important part of successful property investing. Read on for an explanation of the various types of insurance you might need that real estate investors have found crucial.
Who needs a Vacant Dwelling policy?
If you have an investment or primary home that has been vacant for 60 days or more, you need a Vacant Dwelling policy.
Who needs a Builder’s Risk policy?
If you’re doing renovation and increasing the value of your home by 50%, your property qualifies for the builder’s risk program.
What does Investment Insurance Cover?
The specifics of what is included in each investment insurance policy varies by company. The most common protections include general liability insurance, property damage liability insurance and business income insurance. We can help you determine the right level of coverage for your investment property.
What is Landlord Insurance?
Landlord insurance, also known as rental property insurance is a specialized type of insurance designed for property owners who rent out their properties to tenants for short or long term rentals. It provides coverage for various risks and liabilities associated with being a landlord. Here are some key aspects of landlord insurance:
- Property Damage: Covers damage to the rental property caused by events like fire, storm, or vandalism. It typically doesn’t cover tenant-caused damage, but some policies may include provisions for that.
- Loss of Rental Income: If the property becomes uninhabitable due to a covered event (like a fire), this coverage helps compensate for lost rental income during the repair period.
- Liability Protection: Provides coverage in case a tenant or visitor is injured on the property and decides to sue. This can help cover legal fees and any damages awarded.
- Legal Expenses: Covers costs related to legal disputes with tenants, such as eviction proceedings or disputes over rental agreements.
- Contents Insurance: If the property is furnished, this part of the policy covers damage or loss of the furnishings and appliances.
- Emergency Assistance: Some policies offer services like emergency repairs or assistance if something goes wrong with the property.
Landlord insurance is different from homeowner’s insurance because it specifically addresses the risks and needs associated with rental properties. If you’re renting out a property, having this type of insurance helps protect your investment and manage potential financial losses. If you need a Landlord Policy to help with your liability coverage please give L & M Insurance a call.
What type of Rental Property Insurance Policy do I need to insure my tenant-occupied property?
There are two types of policies to choose from to insure your rental property correctly.
- DP1 is a bare-bones, policy offering actual cash value coverage on your personal property. There is no burglary and theft coverage or coverage for accidental water damage. If your air conditioning unit is stolen, this policy will not pay for it to be replaced. If your plumbing leaks and floods the home, there is no coverage.
- A DP3 policy covers everything the DP1 does except that it pays replacement cost instead of actual cash value. It also pays burglary and theft as well as accidental water damage. To protect your property properly, the DP3 is the better choice.
Should I require my tenants to have Renters Insurance?
Renters insurance primarily benefits the tenants by protecting their belongings. Requiring rental insurance usually gives landlords the additional benefits of reducing claims on your landlord insurance policy, mitigating risks of property damage, and helping to keep rents from rising. Read our full article about the benefits of requiring renters insurance in the rental terms agreement here.
What if my property is in the name of an LLC or trust?
If your property is held in a trust or LLC, you must buy a separate liability policy.
More insurance carriers are available to choose from if your property is owned by an LLC rather than a trust.
We at L&M Insurance understand how properties held in a trust or LLC need to be insured.
In order to insure the property with the company that has the lowest rates and best coverage for you, we need complete and accurate information about the LLC or trust. You will get the most accurate quote if you are able to answer our agent’s questions fully and honestly. If possible, it helps us when insuring the property to have a copy of the trust.
Can I as an investor write multiple properties on the same liability policy?
Yes, as long as they are all in the same name, whether it be in an individual’s name or in the name of an LLC or trust. This can be a great way to simplify and save on your general liability coverage.
When do I need a flood policy?
If your property is in a flood zone and you have a mortgage, you are required to have a flood policy.
What is the difference between sinkhole coverage and catastrophic ground coverage collapse?
If you have a sinkhole claim you can live in the home while it is being repaired. With catastrophic ground coverage collapse, your home has to be damaged to the extent that it is not livable. Catastrophic ground coverage collapse is included in all DP and H03 policies.
Can I insure a property that has had a sinkhole claim?
Yes, once the repair has been signed off on by a licensed engineer.
When do I need a four point inspection in order to bind coverage on my new purchase?
If your property is older than 30 years.
How can a wind mitigation help me?
If your property is an older home and you have replaced the roof, a wind mitigation can save you hundreds on your property insurance. You can get a four point inspection and a wind mitigation for $95.00.
Talk to the Real Estate Investor Insurance Experts
As you can see there are a number of factors and considerations that go into choosing the right property investment insurance. The team at L & M Insurance group is here to help you choose the proper amount of coverage to protect your rental property, vacation rental, investment property, or under construction projects. Additional coverage can also be purchased in the form of an umbrella policy. We understand the intricacies of choosing the right amount to protect against unforeseen circumstances while keeping costs low.
Please email us or call our office at 813-672-4100 with additional questions or to get started on making sure your investment property is properly insured.
