Renting out your home may seem like a welcome prospect, but whether you do so on a short or long-term basis, you’ll probably need a more specialized insurance policy to ensure that you and your property, are adequately protected. While a lot may depend upon your specific rental scenario, generally, a standard homeowner’s policy does not give you adequate coverage.
If you’re thinking about renting out your home, or even just one room within your home, you should schedule an appointment to talk to an insurance professional about the right kind of insurance policy. However, the following information should give you something to consider before you take that step:
Insurance scenarios for short term/primary residence rentals
There are usually two applicable insurance scenarios if you’re planning to rent out all, or part of your home on a temporary or short-term basis:
Some, but not all, insurance providers may allow short term rental to be covered under an existing homeowner’s policy, but prior notice must have been given, and some will require an endorsement to the existing policy to be put in place.
Regularly renting your primary residence for short periods of time constitutes a business, and as such, you’d need to acquire a business policy to ensure you were adequately covered.
Insurance scenarios for long-term rentals or second home
If you plan to lease your home to anyone on a long-term basis, you will probably need to purchase a landlord or rental dwelling policy. While these policies typically cost more than a standard homeowners’ policy, they are essential for long-term rentals and regular renting out of a vacation home or investment property; don’t have them, and you simply won’t be insured for physical damage to the structure of the home caused by any number of listed perils, or for personal property you may leave on-site for maintenance purposes or tenant use. Landlord policies invariably include liability coverage, too, meaning that if a tenant or guest is injured while on the property, the legal fees and any medical expenses incurred, would be covered.
It’s important to note that most landlord policies also provide coverage in the event that you’re not able to rent out the property while it’s being repaired or rebuilt due to damage from a listed loss.
For more detailed guidance about renting out your property and getting adequate coverage through a landlord’s insurance policy, talk to a professional insurance agency in your area. With specialist knowledge of local markets and renters’ regulations, they’re in the best place to give you the most up-to-date and accurate advice; not only that, but they might be able to save you some money, too.