Why You Need a Dwelling Insurance Policy for Your Rental Property
Have you recently purchased a holiday home? Do you have plans to rent it out? Before you post rental ads on the Internet, you need to protect it first with the right insurance policy. After all, vacation homes do not come cheap and renting them out without insurance puts them at high risk for costly damages.
Which Insurance Type Should I Get?
It is likely that you already have your mind on a homeowner’s insurance for your holiday property. However, you must understand that this type of policies are often expensive and more importantly, they rarely or don’t cover rental activities at all. This means once a tenant accidentally damaged your property, your homeowner’s insurance won’t cover the said damages. Hence, you need a policy that suits your needs as a rental property owner.
Is Dwelling Insurance Policy an Ideal Choice?
Compared to a comprehensive homeowner’s insurance, the dwelling insurance policy is more affordable. This type of insurance covers the structure of your property once it got damaged due to certain and specific perils. More often than not, the named perils include fire, lightning, hail or sleet, wind damage, riot, explosion, and sinkholes. You can add particular hazards in your dwelling insurance, including earthquakes and vandalism.
Typically, rental properties do not contain valuable possessions of the owner. Hence, you don’t essentially need a full coverage; a dwelling insurance policy will suffice. But to make your property protection stronger, consider tenant occupied dwelling insurance. In this type of policy, you can add rental-specific perils such as water damage, burst pipes, and broken windows and doors. After all, these are the hazards that will likely occur in your rental property.
When renting out your holiday home, you likely want to earn extra money. But without the right insurance, you are only at risk for spending more money when you put up your property for rent.
If you want to know more about dwelling insurance policy, Vacation Rental Insurance Agency can assist you. Call us today to get started.