Often referred to as ‘Rental Property Insurance’, Landlord insurance is designed for people who rent their Home, Condo or Apartment to a third-party and require insurance to cover their personal belongings as well as their liability exposures.
While renting your property can be an useful source of income, it is important that Landlords protect this income by ensuring they have an insurance policy designed to cover rental properties.
Certain homeowner insurance policies provide coverage for renting out a portion of their real estate but they will usually do so only if the homeowner also occupies a portion of that same property. If a landlord decides to rent out the entire property, most insurance companies will require a specific Rented Property insurance policy.
What Does Landlord Insurance Cover?
Landlord insurance covers a variety of items depending on whether the property in question is a detached home or a stratified condo. Basic coverage includes:
Landlord Property (contents insurance)
Types of Landlord Insurance
There are various types of Landlord insurance and each tends to have a different degree of risk associated with it. As a result, different coverages are recommended depending on the situation.
For example, a family renting a home presents a different degree of risk compared to a student renting a room for a school term. Research shows that short-term rental arrangements are often considered to be riskier than long-term tenants. Other criteria insurance companies use to determine the degree of risk for landlords is the screening method used by the landlord when selecting their tenants. We have outlined a number of the most common types of landlord insurance:
Designed to protect single or multiple-family dwellings, this type of Landlord insurance is typically designed for long-term leases or rental agreement basis. We strongly recommend that landlords of this type strongly encourage their tenants to get their own insurance (tenant insurance) due to the fact that a number of insurance companies won’t agree to issue a policy unless the tenants have their own insurance in place.
A second common form of landlord insurance is referred to as Rented Condo Insurance, where the landlord owns a condo that he/she rents out to tenants. This policy type differs from the previous as it is specifically designed to help fill in the gaps that the Strata Corporation insurance policy leaves behind. This type of landlord insurance is often done on a case-by-case basis to ensure the coverage is tailored to the individual risk in question.
In recent months, the resurgence of Airbnb rentals in British Columbia has resulted in a number of insurance companies developing new and creative insurance products to deal with this demand. The policy that best suits this category offers short-term rental coverage for accommodations booked through Airbnb. As one can expect, a special type of insurance is required to adequately protect properties which expose themselves within this unique environment. This particular type of insurance can also be used to protect landlords who own remote properties, landlords who take boarders into their own homes, and even people who rent out seasonal properties.
Landlord Insurance Coverages
Most landlord insurance policies are customized to meet the needs of each of the situations outlined above, but there are some common coverage options that help to protect landlords from financial disaster, including:
This is the liability protection for the actual structure or portion of the structure, you are renting out. You can also get associated structure coverage for garages, sheds, and other structures on your property.
You want to trust your tenants, but smart business professionals protect themselves from every contingency. Vandalism protection will make sure that you are covered in the event that you get a tenant who does not respect your property.
Fair rental income protection
If your property becomes uninhabitable for any reason and you have a loss of rent due to your tenants being forced to vacate, then you can still get paid your rental income up to a predetermined level.
Under construction coverage
This type of landlord liability coverage protects your property as it is being built, or while it is being renovated prior to taking on tenants.
Condo liability protection
As a landlord, you should never rely on your condo association insurance to protect your investment. For example, any updates or improvements you make to your condo are not covered by the condo association policy if there is a fire or some other kind of damage. You will need to protect them yourself, and that is why you need comprehensive condo coverage.
If you rent out structures that include furniture and appliances, then you should get theft coverage to protect your property.
How Much Does Landlord Insurance Cost in BC?
Unlike Tenants or Condo insurance, Landlord insurance requires a more investigative and individualized approach as it considers more than simply the value of the property. Depending on the coverages you select, the cost of landlord insurance varies. Typical landlord insurance policies can fluctuate between $30-$75/month. All of our offices are well-equipped to provide landlord insurance options and represent Canada’s largest and most reputable insurance companies. Get in touch with one of our local offices to get an insurance quote and ensure you have the right coverage are in place. They can offer you a free insurance quote on the building as well as other exposures you face as a landlord.