YOU ASK:

What is the difference between homeowners insurance and landlord insurance?

WE ANSWER:

In short,

  • homeowners insurance protects your home and its contents,
  • landlord insurance protects against lost income or damages while you are renting out a property to someone else.

Homeowners Insurance

A homeowners insurance policy provides protection for loss you may incur when a covered event occurs and damages your property. This may include natural disasters such as earthquakes or floods, as well as theft, acts of war or riots, and fire. This insurance coverage will help pay if your house is damaged and you need to have it rebuilt. For example, a hurricane destroyed the roof in your garage. The insurance will pay for the reroofing.

The homeowners insurance may also pay for lost and covered items that have been stolen from your house. It may also include liabilities to other persons because of acts performed by covered family members, a pet (i.e. dog bites or dog attacks) or the property itself (i.e. liability because someone slipped and fell off your porch).

To check the extent of the coverage of a homeowners insurance policy, it is best to look at the policy's terms and conditions. This is important since some policies do not cover acts of God such as earthquakes, floods, etc.

Landlord Insurance

Meanwhile, landlord insurance provides protection for any income they lost. It also acts as a kind of liability insurance and will pay in the event that your tenant sues you for something that happened while they were renting your property. This insurance will pay for legal expenses and legal fees in case you have to defend yourself against a lawsuit filed by your tenant.

In case the property is damaged because of a covered cause, the insurance will also kick in to pay for lost rental income, as well as to have the property fixed so that you can be able to rent it out again. The landlord insurance covers only the rights and property of the landlord. The tenant's personal belongings and liabilities are not covered. These may be protected under a renter's insurance that the tenant may opt to get.

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