What is it?
Who needs it?
What is rental property insurance?
Investing in rental properties requires significant financial commitment, and the resources invested in these properties should be protected whenever possible. One important way that California landlords can better safeguard their properties and their investments is through rental property insurance.
Rental property insurance provides tailored coverage for residential investment properties. Rental property policies contain specific provisions that can be a great help to landlords.
Who in California should consider investment property insurance?
Anyone owning rental property in California should consider investment property insurance. Full-time investors, part-time investors and small businesses with properties might all get a policy.
In many scenarios, landlords who have financed their properties with residential investment loans are required to carry at least certain coverages. Lenders often include such a requirement so that their interest in a property is well protected against loss.
Irrespective of any such requirement, however, an investment property policy is generally recommended regardless of any insurance company’s requirement.
Can rental property policies cover mixed-use properties?
Rental property policies are primarily designed for residential properties. If you own a mixed-use property, which combines residential and commercial elements, a different insurance policy might be necessary.
An insurance policy that’s good for mixed-use property should provide adequate coverage for both the residential and commercial portions of the property. An experienced insurance agent can guide you through coverage needs and choosing a policy.
What protections can landlords get through investment property insurance?
Investment property insurance may provide a variety of coverages that landlords often find beneficial. Some common coverages include:
- Dwelling Coverage: Usually offers protection for a property’s main buildings, and other structures on a property.
- Landlord Contents Coverage: Usually offers protection for appliances, landscaping equipment, and other landlord-owned items stored at a property.
- Loss of Income Coverage: Usually offers protection against income losses if a disaster makes a property unlivable.
- Rent Guarantee Coverage: Usually offers protection against income losses if tenants fail to pay their rents.
- General Liability Insurance in California: Usually offers protection against certain lawsuits alleging the landlord caused injury or property damage.
- Legal Assistance Coverage: Usually offers protection against legal fees not associated with a liability suit, like attorney fees if filing for a judgment.
Do landlords need rent guarantee coverage?
The need for rent guarantee coverage depends largely upon how much landlords rely on receiving regular rent payments.
Landlords who rely on regular rental rent payments to meet loan obligations or maintain cash flow should probably consider rent guarantee coverage coverage. In fact, landlords with outstanding loans might be required to carry it. In these situations, landlords could face significant financial straights if tenants fail to pay their rents.
Landlords who don’t need rent payments to meet loan obligations or maintain cash flow may forgo this coverage. In these situations, landlords might be able to financially survive while they work to collect unpaid rents. This is sometimes the case with landlords who have properties in addition to a standard job.
When determining whether to get this coverage, landlords can consult with an insurance agent who’s specialized in investment property insurance. A knowledgeable agent will be able to help landlords assess their needs for this and other coverages.
How can landlords in California get rental property insurance?
If you have rental properties in California to insure, contact the independent insurance agents at Heffernan Walton Insurance. Our experienced team will work closely with you to assess coverage needs, and then help you compare rental property insurance policies that meet those needs well. As an independent agency, we can recommend the best policies available to you regardless of the insurance provider that underwrites them.