landlord insurance

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Oh123
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landlord insurance

Post by Oh123 »

We are renting out our condo and I am shopping for landlord liability insurance. Right now it is covered under the association's policy for exterior and we have condo owner's policy for the interior. The tenant will be getting renter's insurance. We have a personnel umbrella policy for 1M. I assume I need to convert the condo owner policy to landlord insurance. What should I be looking for coverage in a landlord policy?
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gwe67
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Re: landlord insurance

Post by gwe67 »

Oh123 wrote: Tue Jul 20, 2021 10:33 am We are renting out our condo and I am shopping for landlord liability insurance. Right now it is covered under the association's policy for exterior and we have condo owner's policy for the interior. The tenant will be getting renter's insurance. We have a personnel umbrella policy for 1M. I assume I need to convert the condo owner policy to landlord insurance. What should I be looking for coverage in a landlord policy?
Sounds like you are "new" to this. I say sell the condo before it's too late. Especially if you qualify for the exclusion.
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av111
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Re: landlord insurance

Post by av111 »

Oh123 wrote: Tue Jul 20, 2021 10:33 am We are renting out our condo and I am shopping for landlord liability insurance. Right now it is covered under the association's policy for exterior and we have condo owner's policy for the interior. The tenant will be getting renter's insurance. We have a personnel umbrella policy for 1M. I assume I need to convert the condo owner policy to landlord insurance. What should I be looking for coverage in a landlord policy?
OP

Talk to Farmers for a landlord policy. Suggest 2500 deductible and 1m liability
AV111
DarkHelmetII
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Re: landlord insurance

Post by DarkHelmetII »

American Modern insurance provided me a competitive vacant property policy, assuming they might also be competitive for tenant-occupied properties.

Also try Assurant via Geico.
2tall4economy
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Re: landlord insurance

Post by 2tall4economy »

what you're looking for is usually called a "fire policy" but every company has a different name for it ("homeowners's policy for home rented to others" is one of the quotes I got recently).

But as the other posted said -- and having been in the rental business for nearly 20 years, sell now, don't hold and rent. We're at a price peak. The next ~5 years will be stagnant pricing I think and after that who knows where post-COVID housing trends will be.
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cchrissyy
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Re: landlord insurance

Post by cchrissyy »

The top of my landlord policy actually says "Dwelling Fire"

OP I agree with the advice above on the question you didn't ask. Rethink selling.
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Oh123
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Re: landlord insurance

Post by Oh123 »

Thank you for the feedback. We already signed a lease agreement starting next month. We debated a bit about sell vs rent, but decided to diversify to real estate as the other 80% of our savings are in the stock/bond market. The mortgage interest is only 3.0% and if we buy a rental unit later we will be paying a higher investment property interest rate. It is 300k worth of property and 100k remains on the mortgage. We will be netting $1400 per month after all the expenses, $900 out of it will go as the principle for the mortgage. We just moved out of it so we have another 3 years to get the waive on the capital gain if we decide to sell it. I understand the future is uncertain and the same goes with stock/bond markets.

I got a quote for landlord insurance which has only 300k in liability coverage. I have a 1M umbrella policy. Would that be good enough or should I go for 1M liability coverage with landlord insurance itself? Thanks
hayhayday
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Re: landlord insurance

Post by hayhayday »

If 300k is your underlying requirement for umbrella that should be fine, make sure numebr of residences on umbrella reflects the right total
Topic Author
Oh123
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vacant home insurance

Post by Oh123 »

[Thread merged into here --admin LadyGeek]

I recently moved out of a condo and listed it for rental. We have a lease agreement starting September 1st. My condo owners insurance company just cancelled my policy saying that I need to update that to a vacant home policy. I am planning to get landlord insurance starting Sep 1st. My insurance agent said we can start the landlord insurance policy tomorrow itself. My question is that would that be enough to cover the property when it is vacant? Is that the type of coverage that I need to have in between tenants? Thanks
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ResearchMed
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Re: vacant home insurance

Post by ResearchMed »

Oh123 wrote: Tue Jul 20, 2021 5:54 pm I recently moved out of a condo and listed it for rental. We have a lease agreement starting September 1st. My condo owners insurance company just cancelled my policy saying that I need to update that to a vacant home policy. I am planning to get landlord insurance starting Sep 1st. My insurance agent said we can start the landlord insurance policy tomorrow itself. My question is that would that be enough to cover the property when it is vacant? Is that the type of coverage that I need to have in between tenants? Thanks
You need to ask the specific insurer if the policy that *you* have or will get will be satisfactory for your needs - and explain it to them exactly. The last thing you want is to omit anything, need to file a claim, and then find out the situation wasn't right for that coverage, etc.

And also *read* the policy. Ask them to point out the sentences/sections that show you are covered for what you need. It won't help later, if a claim is filed, to say, "Well, the agent told me it was covered"...

RM
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Oh123
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Re: vacant home insurance

Post by Oh123 »

Yes, I asked the agent this question and she clarified that it covers. I wanted to hear from experienced people. If I hear anything different here, I can clarify that with the agent. Thanks
DoubleComma
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Re: vacant home insurance

Post by DoubleComma »

Yes, a vacant home policy is what you need. I had to have one during a 4 month period between moving out of a home and selling it. It was quite expensive, much more than I had expected, multiple times the cost of the traditional HO policy. In my specific case the expense was from having a now unattended swimming pool, I guess that is a big risk for the insurance company. However in general, the reason for the expense is they don't know how long it will be vacant and in vacant homes small problems become huge issues fast...like a small faucet leak that floods a house over a couple weeks since nobody is there to catch it.

I still find it ironic that my second home is vacant 50% of the time, often for 3 weeks straight, but we don't seem have the same premium penalty on that home.
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Oh123
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Re: vacant home insurance

Post by Oh123 »

DoubleComma wrote: Tue Jul 20, 2021 6:16 pm Yes, a vacant home policy is what you need. I had to have one during a 4 month period between moving out of a home and selling it. It was quite expensive, much more than I had expected, multiple times the cost of the traditional HO policy. In my specific case the expense was from having a now unattended swimming pool, I guess that is a big risk for the insurance company. However in general, the reason for the expense is they don't know how long it will be vacant and in vacant homes small problems become huge issues fast...like a small faucet leak that floods a house over a couple weeks since nobody is there to catch it.

I still find it ironic that my second home is vacant 50% of the time, often for 3 weeks straight, but we don't seem have the same premium penalty on that home.
You are saying that I need vacant home insurance, landlord insurance is not enough?
DoubleComma
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Re: vacant home insurance

Post by DoubleComma »

Let me also add, my family (not I) have been in the insurance business for year as brokers and on the carrier side. When I got the sticker shock of vacant home policy and considered just lying and saying I was still there. I was told that insurance companies are pretty wise to this, if a major claim is paid they pay particular attention to the furnishings, personal items, might even look at the utility bills. They are generally happy to pay covered claims, but they are very keen to catching fraud.
DoubleComma
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Re: vacant home insurance

Post by DoubleComma »

Oh123 wrote: Tue Jul 20, 2021 6:19 pm
DoubleComma wrote: Tue Jul 20, 2021 6:16 pm Yes, a vacant home policy is what you need. I had to have one during a 4 month period between moving out of a home and selling it. It was quite expensive, much more than I had expected, multiple times the cost of the traditional HO policy. In my specific case the expense was from having a now unattended swimming pool, I guess that is a big risk for the insurance company. However in general, the reason for the expense is they don't know how long it will be vacant and in vacant homes small problems become huge issues fast...like a small faucet leak that floods a house over a couple weeks since nobody is there to catch it.

I still find it ironic that my second home is vacant 50% of the time, often for 3 weeks straight, but we don't seem have the same premium penalty on that home.
You are saying that I need vacant home insurance, landlord insurance is not enough?
Yes, from now until its rented and occupied you need a vacant home policy.
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LadyGeek
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Re: landlord insurance

Post by LadyGeek »

Oh123 - In order to provide appropriate advice, it's best to keep all the information in one spot. I merged your new question back into the original thread.

(Thanks to the member who reported the post and provided a link to this thread.)
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ResearchMed
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Re: vacant home insurance

Post by ResearchMed »

Oh123 wrote: Tue Jul 20, 2021 6:14 pm Yes, I asked the agent this question and she clarified that it covers. I wanted to hear from experienced people. If I hear anything different here, I can clarify that with the agent. Thanks
If you asked this question properly of your agent, that is *not* clear from where you wrote the following:

" I am planning to get landlord insurance starting Sep 1st. My insurance agent said we can start the landlord insurance policy tomorrow itself. My question is that would that be enough to cover the property when it is vacant? Is that the type of coverage that I need to have in between tenants? "

All you have written in that section is that your agent stated you "could start the landlord insurance policty tomorrow itself". That doesn't explain whether it covers an empty house. That would still depend upon the terms of the policy.
Why are you not asking the agent those *specific* questions?

Also, even IF someone else here here has a "landlord policy that covers an empty house for X days", that doesn't mean that your policy does, not even if it is the same company.

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ResearchMed
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Re: landlord insurance

Post by ResearchMed »

Oh123 wrote: Tue Jul 20, 2021 2:24 pm Thank you for the feedback. We already signed a lease agreement starting next month. We debated a bit about sell vs rent, but decided to diversify to real estate as the other 80% of our savings are in the stock/bond market. The mortgage interest is only 3.0% and if we buy a rental unit later we will be paying a higher investment property interest rate. It is 300k worth of property and 100k remains on the mortgage. We will be netting $1400 per month after all the expenses, $900 out of it will go as the principle for the mortgage. We just moved out of it so we have another 3 years to get the waive on the capital gain if we decide to sell it. I understand the future is uncertain and the same goes with stock/bond markets.

I got a quote for landlord insurance which has only 300k in liability coverage. I have a 1M umbrella policy. Would that be good enough or should I go for 1M liability coverage with landlord insurance itself? Thanks
You REALLY need to ask your insurer!

Our experience in two different states was that we needed the commercial/business policy and a commercial/business umbrella policy. Our personal policies would not cover any commercial situations.
But that may be insurer-specific or state-specific.

Ask!

RM
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RickBoglehead
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Re: vacant home insurance

Post by RickBoglehead »

Oh123 wrote: Tue Jul 20, 2021 5:54 pm [Thread merged into here --admin LadyGeek]

I recently moved out of a condo and listed it for rental. We have a lease agreement starting September 1st. My condo owners insurance company just cancelled my policy saying that I need to update that to a vacant home policy. I am planning to get landlord insurance starting Sep 1st. My insurance agent said we can start the landlord insurance policy tomorrow itself. My question is that would that be enough to cover the property when it is vacant? Is that the type of coverage that I need to have in between tenants? Thanks
Exactly what your agent is supposed to tell you.

In principle, you should put the $900 towards principal...
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Topic Author
Oh123
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Re: landlord insurance

Post by Oh123 »

It appears that landlord insurance won't cover vacant homes. Does it mean that every time a tenant moves out, we need to get vacant home insurance even if it is for few days until the new tenant moves in? Is that how everyone managing their rental properties?
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ResearchMed
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Re: landlord insurance

Post by ResearchMed »

Oh123 wrote: Tue Jul 20, 2021 6:55 pm It appears that landlord insurance won't cover vacant homes. Does it mean that every time a tenant moves out, we need to get vacant home insurance even if it is for few days until the new tenant moves in? Is that how everyone managing their rental properties?
"........ Ask the agent about the policy *you* will be getting....".

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galawdawg
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Re: landlord insurance

Post by galawdawg »

Oh123 wrote: Tue Jul 20, 2021 6:55 pm It appears that landlord insurance won't cover vacant homes. Is that what your insurance agent told you?

Does it mean that every time a tenant moves out, we need to get vacant home insurance even if it is for few days until the new tenant moves in? What did your insurance agent tell you when you asked him/her how to handle this?

Is that how everyone managing their rental properties? Your circumstances may differ, but when we owned rental property, the fire policies on each rental property did not have any requirement that the property remain occupied. However, certain coverages were excluded if the dwelling was vacant, such as freezing of plumbing system unless either heat was maintained in the property or the water was shut off and the system drained. Again, your insurer may have different requirements.
Responses above in red.
Topic Author
Oh123
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Re: landlord insurance

Post by Oh123 »

galawdawg wrote: Tue Jul 20, 2021 7:06 pm
Oh123 wrote: Tue Jul 20, 2021 6:55 pm It appears that landlord insurance won't cover vacant homes. Is that what your insurance agent told you?

Does it mean that every time a tenant moves out, we need to get vacant home insurance even if it is for few days until the new tenant moves in? What did your insurance agent tell you when you asked him/her how to handle this?

Is that how everyone managing their rental properties? Your circumstances may differ, but when we owned rental property, the fire policies on each rental property did not have any requirement that the property remain occupied. However, certain coverages were excluded if the dwelling was vacant, such as freezing of plumbing system unless either heat was maintained in the property or the water was shut off and the system drained. Again, your insurer may have different requirements.
Responses above in red.

Thank you for this response. Now I know what to ask my agent. Would you mind disclosing the insurance company where I can get protection for fire damage even if it is vacant which I am mostly worried about? I will get the full policy disclosure tomorrow before signing up for the landlord isnurance and will pay attention to what it says about fire protection when vacant.
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ResearchMed
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Re: landlord insurance

Post by ResearchMed »

Oh123 wrote: Tue Jul 20, 2021 7:21 pm
galawdawg wrote: Tue Jul 20, 2021 7:06 pm
Oh123 wrote: Tue Jul 20, 2021 6:55 pm It appears that landlord insurance won't cover vacant homes. Is that what your insurance agent told you?

Does it mean that every time a tenant moves out, we need to get vacant home insurance even if it is for few days until the new tenant moves in? What did your insurance agent tell you when you asked him/her how to handle this?

Is that how everyone managing their rental properties? Your circumstances may differ, but when we owned rental property, the fire policies on each rental property did not have any requirement that the property remain occupied. However, certain coverages were excluded if the dwelling was vacant, such as freezing of plumbing system unless either heat was maintained in the property or the water was shut off and the system drained. Again, your insurer may have different requirements.
Responses above in red.

Thank you for this response. Now I know what to ask my agent. Would you mind disclosing the insurance company where I can get protection for fire damage even if it is vacant which I am mostly worried about? I will get the full policy disclosure tomorrow before signing up for the landlord isnurance and will pay attention to what it says about fire protection when vacant.
This would likely depend upon where you live plus possibly specifics of the property.

Contact a local "Independent Insurance Broker" company, with several agents. They can help find the best policy with the best insurer suitable for your needs.

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galawdawg
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Re: landlord insurance

Post by galawdawg »

Oh123 wrote: Tue Jul 20, 2021 7:21 pm
galawdawg wrote: Tue Jul 20, 2021 7:06 pm
Oh123 wrote: Tue Jul 20, 2021 6:55 pm It appears that landlord insurance won't cover vacant homes. Is that what your insurance agent told you?

Does it mean that every time a tenant moves out, we need to get vacant home insurance even if it is for few days until the new tenant moves in? What did your insurance agent tell you when you asked him/her how to handle this?

Is that how everyone managing their rental properties? Your circumstances may differ, but when we owned rental property, the fire policies on each rental property did not have any requirement that the property remain occupied. However, certain coverages were excluded if the dwelling was vacant, such as freezing of plumbing system unless either heat was maintained in the property or the water was shut off and the system drained. Again, your insurer may have different requirements.
Responses above in red.

Thank you for this response. Now I know what to ask my agent. Would you mind disclosing the insurance company where I can get protection for fire damage even if it is vacant which I am mostly worried about? I will get the full policy disclosure tomorrow before signing up for the landlord isnurance and will pay attention to what it says about fire protection when vacant.
I'd suggest your discuss your insurance needs with your agent. He/she is best positioned to answer your questions about coverage options with your current insurer.

You can also get quotes from other insurance companies but it is likely that if you currently have umbrella coverage with your current provider, they will require that your rental property policy also be issued by them. In that case, competitive quotes will need to quote all of your current policies as well as your rental property coverage needs.
Topic Author
Oh123
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Re: landlord insurance

Post by Oh123 »

galawdawg wrote: Tue Jul 20, 2021 7:37 pm
Oh123 wrote: Tue Jul 20, 2021 7:21 pm
galawdawg wrote: Tue Jul 20, 2021 7:06 pm
Oh123 wrote: Tue Jul 20, 2021 6:55 pm It appears that landlord insurance won't cover vacant homes. Is that what your insurance agent told you?

Does it mean that every time a tenant moves out, we need to get vacant home insurance even if it is for few days until the new tenant moves in? What did your insurance agent tell you when you asked him/her how to handle this?

Is that how everyone managing their rental properties? Your circumstances may differ, but when we owned rental property, the fire policies on each rental property did not have any requirement that the property remain occupied. However, certain coverages were excluded if the dwelling was vacant, such as freezing of plumbing system unless either heat was maintained in the property or the water was shut off and the system drained. Again, your insurer may have different requirements.






Responses above in red.

Thank you for this response. Now I know what to ask my agent. Would you mind disclosing the insurance company where I can get protection for fire damage even if it is vacant which I am mostly worried about? I will get the full policy disclosure tomorrow before signing up for the landlord isnurance and will pay attention to what it says about fire protection when vacant.
I'd suggest your discuss your insurance needs with your agent. He/she is best positioned to answer your questions about coverage options with your current insurer.

You can also get quotes from other insurance companies but it is likely that if you currently have umbrella coverage with your current provider, they will require that your rental property policy also be issued by them. In that case, competitive quotes will need to quote all of your current policies as well as your rental property coverage needs.
My current umbrella insurance policy is with Progressive and told me that they don't offer vacant home insurance or landlord insurance in my area. Condo insurance was only $30 per month, so even if I get vacant home insurance for a month, I hope it won't be that high.

I could go with fire-dwelling insurance only instead of a vacant home but I believe it won't have liability protection. My umbrella insurance requires me to have $300k liability under other policies. I need to verify that it is a requirement for policy on the rental unit as well.
Topic Author
Oh123
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Re: landlord insurance

Post by Oh123 »

I called Travelers insurance which is the company my agent quoted. They said landlord insurance will cover fire and more but damages due to freezing pipes or vandalism will not be covered when it is vacant. The quoted premium is only $36 per month similar to my condo owner's policy. Not worried about the vandalism, but if the property becomes vacant in winter, we may need to pay attention to freezing pipes.

I know we need to get information from the company we work with, but we also need to educate ourselves to ask the right questions to the company. Thanks to everyone for contributing to my questions.
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cchrissyy
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Re: landlord insurance

Post by cchrissyy »

Oh123 wrote: Tue Jul 20, 2021 6:55 pm It appears that landlord insurance won't cover vacant homes. Does it mean that every time a tenant moves out, we need to get vacant home insurance even if it is for few days until the new tenant moves in? Is that how everyone managing their rental properties?
no that would not be typical.
+1 to everyone saying to read and understand your policy
hayhayday
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Re: landlord insurance

Post by hayhayday »

Most landlord policies I have seen allow up to 30 days of vacancy between tenants, USAA is 90 days at least in my state so if eligible you might check if that would work as a stop gap.
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