Landlords are one of those who are into buying investment properties in order to make more money by having them rented. But as with any property investment, insurance is also a must. Therefore, landlords have them insured. Unfortunately, for those renting any of these houses or apartments, only the property or the place is insured. Not what is in the house; everything inside is your property. If anything happens, the landlord is insured, you’re not. You could lose everything in a blink of an eye. That’s why it is important to have rental property insurance. Most of the time, it is required by landlords as part of the lease. But if it is not, discussed below are the different types of rental property insurance coverage that will help in understanding this better.
Loss of Use – this coverage comes into play when your property or house will not be able to be used after an unfortunate event. If it is necessary to stay somewhere else for the entire duration of fixing or repairing your house, this policy will pay for all living and food expenses. For example, if your house becomes flooded due to a storm then it would necessitate you and your family to live somewhere else for the time being. The Loss of Use coverage will reimburse all your expenses for this.
Personal Liability – this coverage handles legal obligations if any individual gets injured on your property. It also used for any damage that happens in the house.
Personal Property – this coverage is considered important because it is related to all your possessions inside the house such as clothes and furniture. Any damage to your possession will be covered by this. Whether you are on a trip or not, this will protect your personal belongings.
Understanding every kind of rental property insurance coverage will help you to decide which would be best suited for you, your family, and property. It is important to get one to ensure protection; you have to be responsible and be protected. It is better to pay a little each month than lose your belongings which would cost you even more. Remember, everything you own can disappear in a snap, so it’s worth it to be prepared.
For investment property owners, one of the best ways to protect their finances from any risk is setting up an LLC or Limited Liability Company. This way, a landlord’s finances are protected from any lawsuit filed by a tenant.
Source: Financial Planning Tips