The cost of landlord insurance is expensive and burdensome for many property owners. In fact, many may believe that they are overpaying for even a basic landlord insurance policy. Yet, if you are a rental property investor with only basic coverage, you may necessitate more insurance to protect yourself and your property against unforeseen events.
Having insurance that covers more than just your rental house is crucial for landlords in Santa Clara. Comprehensive coverage for lost rent, full liability, and unexpected special assessments can ensure that you have the right insurance for your situation, providing you with the peace of mind that your investment is protected.
Incidents may require significant repairs
The value of getting insurance coverage to protect their investment against a substantial loss is well-known to the majority of investors. Storm damage, fire, and other events can make the property uninhabitable and necessitate extensive repairs. Loss of rent is something you can’t prevent with a basic landlord insurance policy. This is where fair rental income protection becomes apparent.
Protect your cash flow
If your rental property is temporarily uninhabitable due to a covered claim, this type of insurance, sometimes referred to as fair rental value coverage, may help replace lost rent payments. Although not all landlord insurance policies provide this protection, a few do. If yours does not, and lost rent is a concern for you, then it is vital to investigate adding fair rental income protection to your base policy. Having this additional coverage can provide peace of mind, knowing that your income is protected, no matter what comes your way.
Additional liability coverage
A comprehensive landlord insurance policy will protect you from the cost of property damage and specific forms of responsibility. Many landlord insurance policies include coverage for medical or legal fees if a tenant or guest is injured due to the property’s condition. However, for some property investors, other potential liabilities require more coverage. Additional liability coverage might be the best option in these situations. For instance, if a tenant experiences a break-in while renting one of your properties or commits a crime and you do not take immediate action to address the issue, you may be personally accountable for amounts beyond what a basic landlord policy will cover.
Special Assessment Coverage
In addition to lost rent and liability, consider looking into special assessment coverage. A special assessment is a fee charged by an owner’s association on community association property owners. These special assessments can be tacked on to the current association fees for a variety of purposes, such as crucial repairs or improvement projects in the building or neighborhood. Property owners can purchase special assessment insurance, commonly known as title insurance, to prevent the unwelcome surprise of a large special assessment. This insurance protects your property from special assessments not incorporated in the original purchase documents. If your rental properties are subject to homeowner’s association fees, this is one type of insurance that property investors should seriously consider.
Talk to a professional
Consult with an insurance expert about what you need in order to protect all your assets. Also, as your investment portfolio changes, so should your insurance coverage. In order to ensure that you and your Santa Clara rental properties are fully protected, it is essential to review your insurance coverage annually and make any required revisions. Taking these preventive measures will put your insurance needs squarely in your hands.
Real Property Management Southern Utah advises Santa Clara property owners on the best insurance products and level of protection to secure their investment. We can put you in touch with professionals offering quality insurance policies at the most competitive rates. When you work with industry experts, you can have confidence that you have the right landlord insurance for a long and profitable rental property investing career. Contact us online or at 435-673-4242 for additional data.
Originally Published on September 20, 2019
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