Landlord Policy

What is a Landlord Policy?

A Landlord policy (also known as a non-owner investment property policy) is a homeowner policy with unique coverage to protect properties in which the owner does not occupy the dwelling. A landlord policy is specifically designed for specified risks and perils that affect a landlord differently from a traditional owner-occupied homeowner.

NOTE: It is important to understand that by default your landlord policy will not extend coverage for damage caused by natural flood damage. This would mean that if there is a severe rain storm which causes your property to flood, no coverage would be allotted unless added as an endorsement or separate flood policy. Some states may have an exception to this rule.

If however, as severe storm caused a tree to fall on your roof and the hole in the roof caused your property to flood, this most likely would be covered under your policy. Each policy and company is different on how they define flood and pay coverage.

Landlord policies have lower coverage limits in some areas such as personal property, as the only items that need coverage would be such items as a refrigerator, washer, dryer, stove, etc. This is an apparent difference between landlord and traditional homeowners insurance. A large coverage limit on personal property is not necessary, as the owner will not be storing his/her clothing, furniture and other items in a home that they will most likely rent to others.

These policies are crucial in the event that either the owner or tenant is liable for any negligence causing bodily injury or property damage to others. A very important difference between homeowners and landlord policies is that a landlord policy provides protection against lawsuits arising from both the tenant against the policyowner and other third parties that may submit a claim against the policyowner.

Example: The tenant makes the property owner aware of risks within the property premise that may cause harm or damage to occupants or visitors to the property. The property owner does not take necessary measures to remedy or assess the risk brought to his/her attention. Following making the owner aware, a person is hurt directly from the risk that was brought to the owner’s attention. The incident subsequently results in a lawsuit against the owner of the property.

Another key policy attribute of a Landlord Policy is its "loss of rents" coverage. Similar to “Loss of Use” coverage on a homeowners policy; the loss of rents coverage would reimburse a landlord (or policyowner) with loss of rental income incurred due to a covered loss where the tenant must move out of the property while it is repaired or rebuilt. The traditional Loss of Rents coverage would be a stated dollar amount maximum and 12 months time span. This has now been replaced with “Actual Loss Sustained” or 100% of all loss of rents during the repair or rebuild period.

I have detailed coverage below to illustrate the most common type of coverage a landlord policy would include.

I will start by defining actual cash value, replacement cost and extended replacement costs as these are very important landlord insurance policy attributes. You will have to determine which of these your policy falls into. It is important to understand that you can usually change between the three by calling your agent and updating your policy. All changes must be completed prior to a claim on your policy as this change will affect the payout of your claim significantly. The most common coverage type is extended replacement Cost.

• Actual Cash Value – Is the value of your home minus a deduction for age, wear and tear and other factors

• Replacement Cost – This coverage type pays for loss to your home on a replacement cost basis up to the coverage limit you choose. This would mean, if you have $250,000 dwelling coverage, this is the max that the insurance company will pay. No depreciated value. Coverage is given up to the policy limit on your policy’s declaration page.

• Extended Replacement Cost – This coverage type pays for loss to your home on an extended replacement cost basis up to the coverage limit you choose plus 25% to 200% additional coverage for increases in construction costs or other factors. This would mean, if you have $250,000 dwelling coverage, The insurance company would allow an additional 25% to 200% in coverage to repair or replace your home.

I have detailed the common homeowners insurance policy coverage below:

• Dwelling Coverage – This is the limit that the insurance company would pay to replace your home in the event of a covered loss. It is usually calculated based your home’s information such as sq. footage, roof type, flooring type, and other factors to generate the value needed to replace your home should it be damaged due to a covered peril.

• Separate Structures – This is the limit the insurance company would pay to repair or replace any separate structures in the event of a covered loss. Separate structures include a shed, separated garage, gazebo, etc.

• Personal Property – This limit is the maximum the company would pay to replace any of your personal items such as a refrigerator, washer or dryer in the event of a covered loss.

NOTE: It is important to know whether your personal items are covered under actual cash value or replacement costs. Actual Cash Value will pay at the depreciated value and replacement cost will pay the amount necessary to replace the item with an exact or like kind.

• Loss of Rents - This is the limit the insurance company would reimburse a landlord (or policyowner) for loss of rent income incurred due to a covered loss where the tenant must move out of the property while it is repaired or rebuilt. The traditional Loss of Rents coverage would be a stated dollar amount maximum and 12 months time span. This has now been replaced with “Actual Loss Sustained” or 100% of all loss of rents during the repair or rebuild period.

• Personal Liability - This is the limit the insurance company when you are legally obligated to pay for damages to property or others resulting from negligence on your part. Your personal liability coverage also includes coverage for expenses such as attorney fees, court costs, investigator fees and witness charges when defending you in court. In most cases they will pay you for your time off of work when you are asked to appear in court. All policies handle this differently so it is important to consult with your agent to have a clear definition of how your policy covers personal liability.
  

NOTE: All policies handle this differently so it is important to consult with your agent to have a clear definition of how your policy covers personal liability.

• Medical Coverage – This is the limit the insurance company would pay for any monies incurred by any non-household member for bodily injury on your premises. This is basically a medical aid to others should they have a bodily injury at your residence such as a slip and fall, etc.

• Building Ordinance - This is the limit the insurance company would pay for the extra expense of rebuilding to comply with ordinances or laws, often building codes, that did not exist when the building was originally built.

• Deducible - Your deductible amount is the amount of money you are responsible for as the insured before the insurance company begins payment.

What additional coverage can I add?

These are just a few additional options that may or may not be available with your policy. It is always important to consult with your agent to find out all of your options so that you may make the most educated decision on which fit your needs best.

• Increase Extended Replacement Coverage on dwelling amount
• Add Replacement Cost on Personal Property Coverage
• Add Identity Theft Coverage
• Add Flood Coverage
• Add a Personal Umbrella

Discounts:

These are a few discounts that your policy may offer. It is always recommended that you consult with your agents to see which of these may apply to your policy.

• New Home Discounts – For New homes built within the last 5 yrs
• Gate Community Discount
• Security System Discount
• Good Credit Discount

Payment Options:

Your Homeowners Insurance Policy has a few different payment options.

• Annual
• Semi-Annual
• Monthly

Recommendations:

These are a few recommendations we have regarding your homeowners insurance.

• Review your policy annually with your insurance agent.
• Discuss the need for a Personal Umbrella Policy with your agent.

Get a free Homeowners Insurance quote today.

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DISCLOSURE: All entries by QuoteFishing.com are for informational purposes only and it is always recommended that you consult with your local insurance agent as coverage, definitions and claims procedures may differ from state to state.

Identity Theft Coverage

What is Identity Theft Coverage?

Due to the increase of internet transactions, lack of document shredding and trustworthiness of individuals, Identity theft is the fastest growing crime in the U.S. The Federal Trade Commission estimates that as many as 9 million Americans have their identities stolen each year.

What is Identity Theft? Identity theft occurs when someone uses your personally identifying information, like your name, social security number, or credit card number, without your permission, to commit fraud or other crimes.

Insurance companies have now recognized the importance of this growing crime and have added coverage to protect their clients under the normal homeowners insurance policy. This coverage is not added by default and which means you must call your agent to have it added on. I have found that adding this coverage to your homeowners insurance policy is sometimes less expensive than using a third party company. Prices range from $25 - $75 when adding identity theft coverage to your homeowners insurance policy and between $96 to $179 when using third party companies. The identity theft coverage added to a homeowners insurance policy is usually broader in form. This coverage varies from company to company so it is important to evaluate each company and the coverage each offers in order to make the most educated decision. We recommend consulting with your agent to determine all of your options regarding identity theft coverage.

Such coverage may include:

• Expense Reimbursement
• Paid Loss Reimbursement
• Thrid-Party Claims Management
• Credit Monitoring
• Credit Alerts & Freezes
• Public Records Monitoring
• Travel Document Replacement
• Disaster Document Replacement

It is important to contact your agent to see which if not all coverage types are covered should you add coverage to your policy. You should also ask your insurance agent how many individuals are covered under the added coverage as this varies from company to company. This may range from only one person to your entire family living in your household.

A good resource for extensive information on identity theft is the FTC website which lists extensive information regarding identity theft and all of the actions that should be taken if you are a victim of identity theft. I have listed a few links below:

FTC Website
About Identity Theft
What to do if your identity is stolen?
Tools for Victims


Get a free homeowners insurance quote today.

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DISCLOSURE: All entries by QuoteFishing.com are for informational purposes only and it is always recommended that you consult with your local insurance agent as coverage, definitions and claims procedures may differ from state to state.

Homeowners Insurance 101

What is homeowners insurance?

Homeowners insurance provides coverage for your home and belongings in the event of a disaster or covered peril. Homeowners Insurance coverage varies from policy to policy as well as company to company. Different policies are designed to protect different risks such as a property that is used as your primary residence and a property that is used as a landlord or investment property. These two policies would require completely different coverage as one will need coverage for loss of rents if the property is damaged and the landlord will lose investment income due to the property being vacant during the time of repair. Some properties only require Fire coverage to be covered as the property is being rehabbed and there are no occupants or belongings on premise. For detailed definitions visit our Homeowners Insurance glossary terms.

How am I covered?

NOTE: It is important to understand that by default your homeowner policy will not extend coverage for damage caused by a natural flood damage. This would mean that if there is a severe rain storm which causes your property to flood, no coverage would be allotted unless added as an endorsement or separate flood policy. Some states may have an exception to this rule.

If however, as severe storm caused a tree to fall on your roof and the hole in the roof caused your property to flood, this most likely would be covered under your policy. Each policy and company is different on how they define flood and pay coverage.

I have detailed coverage below to illustrate the most common type of coverage which is the primary residence owner-occupied policy which is your standard homeowners policy.

I will start by defining actual cash value, replacement cost and extended replacement costs as these are very important homeowners insurance policy attributes. You will have to determine which of these your policy falls into. It is important to understand that you can usually change between the three by calling your agent and updating your policy. All changes must be completed prior to a claim on your policy as this change will affect the payout of your claim significantly. The most common coverage type is extended replacement Cost.

• Actual Cash Value – Is the value of your home minus a deduction for age, wear and tear and other factors


• Replacement Cost – This coverage type pays for loss to your home on a replacement cost basis up to the coverage limit you choose. This would mean, if you have $250,000 dwelling coverage, this is the max that the insurance company will pay. No depreciated value. Coverage is given up to the policy limit on your policy’s declaration page.


• Extended Replacement Cost – This coverage type pays for loss to your home on an extended replacement cost basis up to the coverage limit you choose plus 25% to 200% additional coverage for increases in construction costs or other factors. This would mean, if you have $250,000 dwelling coverage, The insurance company would allow an additional 25% to 200% in coverage to repair or replace your home.

I have detailed the common homeowners insurance policy coverage below:

• Dwelling Coverage – This is the limit that the insurance company would pay to replace your home in the event of a covered loss. It is usually calculated based your home’s information such as sq. footage, roof type, flooring type, and other factors to generate the value needed to replace your home should it be damaged due to a covered peril.


• Separate Structures – This is the limit the insurance company would pay to repair or replace any separate structures in the event of a covered loss. Separate structures include a shed, separated garage, gazebo, etc.


• Personal Property – This limit is the maximum the company would pay to replace any of your personal items such as TV, clothing, jewelry and cash in the event of a covered loss.

NOTE: It is important to understand that by default your home will not cover cash for more than $100 to $200. Collectible, Fine China, Jewelry and such items will also have a cap in coverage. Such items must be added on to your policy as a floater or endorsement which may require an appraisal to be insured at full value. This may also add additional costs to your policy.

NOTE: It is important to know whether your personal items are covered under actual cash value or replacement costs. Actual Cash Value will pay at the depreciated value and replacement cost will pay the amount necessary to replace the item with an exact or like kind.

• Loss of Use - This is the limit the insurance company would reimburse you for additional living expenses to maintain your normal standard of living. This would be granted should your property be rendered uninhabitable due to a covered loss.


• Personal Liability - This is the limit the insurance company when you are legally obligated to pay for bodily injury or property damages to others resulting from events such as Acts of your pets, Use of your premises (Such as swimming pools), Unintentional acts committed by your or a qualified household members (either on or off your premises). Your personal liability coverage also includes coverage for expenses such as attorney fees, court costs, investigator fees and witness charges when defending you in court. In most cases they will pay you for your time off of work when you are asked to appear in court. All policies handle this differently so it is important to consult with your agent to have a clear definition of how your policy covers personal liability.

NOTE: All policies handle this differently so it is important to consult with your agent to have a clear definition of how your policy covers personal liability.

• Medical Coverage – This is the limit the insurance company would pay for any monies incurred by any non-household member for bodily injury on your premises. This is basically a medical aid to others should they have a bodily injury at your residence such as a slip and fall, etc.


• Building Ordinance - This is the limit the insurance company would pay for the extra expense of rebuilding to comply with ordinances or laws, often building codes, that did not exist when the building was originally built.
  
  
• Deducible - Your deductible amount is the amount of money you are responsible for as the insured before the insurance company begins payment.

What additional coverage can I add?
These are just a few additional options that may or may not be available with your policy. It is always important to consult with your agent to find out all of your options so that you may make the most educated decision on which fit your needs best.

• Increase Extended Replacement Coverage on dwelling amount
• Add Replacement Cost on Personal Property Coverage
• Add Identity Theft Coverage
• Add Jewelry, Collectibles, Fine China Endorsement
• Add Flood Coverage
• Add a Personal Umbrella

Discounts:
These are a few discounts that your policy may offer. It is always recommended that you consult with your agents to see which of these may apply to your policy.

• New Home Discounts – For New homes built within the last 5 yrs
• Gate Community Discount
• Security System Discount
• Multi-Policy Discount – When insuring your autos and your home with the same company
• Good Credit Discount

Payment Options:
Your Homeowners Insurance Policy has a few different payment options.

• Annual
• Semi-Annual
• Monthly

Recommendations:
These are a few recommendations we have regarding your homeowners insurance.

• Review your policy annually with your insurance agent.
• Complete a Contents Inventory Record in order to itemize your personal property, should you have a fire loss. Your agent should be able to provide a copy and will retain it for you.
• Discuss the need for a Personal Umbrella Policy with your agent.

Get a free Homeowners Insurance quote today.

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DISCLOSURE: All entries by QuoteFishing.com are for informational purposes only and it is always recommended that you consult with your local insurance agent as coverage, definitions and claims procedures may differ from state to state.

Homeowners Insurance Policy - Glossary

We have listed the most common homeowners insurance policy terms and coverage definitions below. We hope that this serves useful in educating yourself about homeowners insurance policy terms.

Actual Cash Value – Is the value of your home minus a deduction for age, wear and tear and other factors

Building Ordinance - This is the limit the insurance company would pay for the extra expense of rebuilding to comply with ordinances or laws, often building codes, that did not exist when the building was originally built.

Deducible - Your deductible amount is the amount of money you are responsible for as the insured before the insurance company begins payment.

Dwelling Coverage – This is the limit that the insurance company would pay to replace your home in the event of a covered loss. It is usually calculated based your home’s information such as sq. footage, roof type, flooring type, and other factors to generate the value needed to replace your home should it be damaged due to a covered peril.

Extended Replacement Cost – This coverage type pays for loss to your home on an extended replacement cost basis up to the coverage limit you choose plus 25% to 200% additional coverage for increases in construction costs or other factors. This would mean, if you have $250,000 dwelling coverage, The insurance company would allow an additional 25% to 200% in coverage to repair or replace your home.

Endorsement - A written document attached to an insurance policy that alters the policy’s coverage, terms, or conditions. This is also sometimes called a rider.

Floater - This is usually an endorsement to the policy in order to cover either one or many jewelry items of significant value. They are covered up to their appraised value and the endorsement serves as a mini policy to cover this item separately to its assessed value.

Jewelry Endorsement - This is usually an endorsement to the policy in order to cover either one or many jewelry items of significant value. They are covered up to their appraised value and the endorsement serves as a mini policy to cover this item separately to its assessed value. This type of endorsement also applies to other valuables such as guns, fine china, collectibles, etc.

Loss of Use - This is the limit the insurance company would reimburse you for additional living expenses to maintain your normal standard of living. This would be granted should your property be rendered uninhabitable due to a covered loss.

Medical Coverage – This is the limit the insurance company would pay for any monies incurred by any non-household member for bodily injury on your premises. This is basically a medical aid to others should they have a bodily injury at your residence such as a slip and fall, etc.

Personal Liability - This is the limit the insurance company when you are legally obligated to pay for bodily injury or property damages to others resulting from events such as Acts of your pets, Use of your premises (Such as swimming pools), Unintentional acts committed by your or a qualified household members (either on or off your premises). Your personal liability coverage also includes coverage for expenses such as attorney fees, court costs, investigator fees and witness charges when defending you in court. In most cases they will pay you for your time off of work when you are asked to appear in court. All policies handle this differently so it is important to consult with your agent to have a clear definition of how your policy covers personal liability.

Personal Property – This limit is the maximum the company would pay to replace any of your personal items such as TV, clothing, jewelry and cash in the event of a covered loss.

Personal Umbrella - A personal umbrella provides increased liability coverage to your auto policies, home policies and recreational vehicles. Once your limits on these policies have been exhausted, your umbrella policy will extend liability coverage up to its policy limits to continue to protect you against claims and defense costs due to a covered loss.

Separate Structures – This is the limit the insurance company would pay to repair or replace any separate structures in the event of a covered loss. Separate structures include a shed, separated garage, gazebo, etc.

Replacement Cost – This coverage type pays for loss to your home on a replacement cost basis up to the coverage limit you choose. This would mean, if you have $250,000 dwelling coverage, this is the max that the insurance company will pay. No depreciated value. Coverage is given up to the policy limit on your policy’s declaration page.


Get a free homeowners insurance quote today.

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DISCLOSURE: All entries by QuoteFishing.com are for informational purposes only and it is always recommended that you consult with your local insurance agent as coverage, definitions and claims procedures may differ from state to state.