Does Homeowners Insurance Cover Renters?

Purchasing and maintaining a home are significant financial investments that require you to implement and maintain suitable loss control measures. While homeowners insurance may seem like a logical choice for protecting residential properties, there may be times when you require different coverage, such as if you plan to rent out your home to someone else.

V Financial Insurance Group in Rolling Meadows, Illinois, can help you understand these situations and ensure you retain optimal coverage for homes you own.

What Kind of Insurance Do Homeowners Need Related to Renters?

Although renting out your home to a tenant can provide a lucrative and convenient source of income, it may also create or exacerbate your risks and exposures. Standard homeowners insurance policies may not be able to financially protect your property if you are not currently living on the premises. You may need to have rental property insurance to ensure adequate coverage while having a renter.

What Do Homeowners Need to Know About Rental Property Insurance?

Rental property insurance can help guarantee you are financially protected from risks and incidents involving a property you’re renting to a tenant. This coverage, also known as landlord insurance, typically provides financial assistance for losses involving your property, including the structural elements of your home and possessions you leave on the property (e.g., snowblowers, lawnmowers and furniture). Your policy may also help pay for losses you are liable for, including those accrued by your tenant or passersby. Finally, most policies also include coverage for lost or reduced revenue if your property is temporarily uninhabitable and you cannot collect rent.

Can You Cover Renters’ Losses?

As the property owner and landlord, rental property insurance may be able to compensate tenants if you are at fault for their losses. However, if an event such as fire, lightning, hail or theft leads to losses involving a renter’s possessions, they typically must have their own renters insurance to receive compensation. Renters insurance is also typically needed to respond to third-party losses for which your tenant is liable.

Sometimes your homeowners insurance can provide some financial protection for losses involving renters. For example, homeowners coverage may be adequate if you continue to live in your home while renting out a room to a tenant. Isolated and short-term rentals may also qualify for coverage under homeowners insurance, although you may be required to notify your insurer and purchase an endorsement.

Speak with your insurance agent about your circumstances to ensure you’re adequately covered.

Get the Right Coverage

Insuring losses while hosting a renter in your home can be complicated and confusing. Fortunately, the dedicated staff at V Financial Insurance Group has the knowledge and experience to assess your circumstances and identify the right solutions. Visit our website or call 847-221-8446 to ensure that you, your property and your renters have optimal financial security.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.