Differences Between Homeowners and Landlord Insurance

What is the difference between homeowner insurance and landlord insurance? Today we are going to discuss what homeowner insurance and landlord insurance are and talk about the differences between the two.

What is homeowner insurance? Homeowner insurance covers a home that a person both owns and resides in, whereas landlord insurance covers property that a person owns but does not occupy. It ensures the property against any possible losses or damages and against any injury that happens on the property. Homeowner insurance coverage also includes the personal belongings of the policy owner.

Keep in mind that if you are not actually living in the residence that your homeowner insurance covers, your policy can be cancelled at any time. The insurer also has the ability to deny you coverage or compensation in the event of an insurance claim.

What is landlord insurance? Landlord insurance is the coverage needed for a home that a landlord owns and rents out to tenants. It works as a protection for the owner's investment to cover any potential losses due to property damage, cover any cost if he or she is found legally responsible for injury or damage to others, and make up for any loss of potential income from their rental.

For example, if a tenant gets hurt in your rental home, you could be found legally responsible as the owner of the property. This is a situation where the extra protection that landlord insurance offers is extremely valuable. The liability coverage on landlord insurance can help to cover the resulting cost of medical bills or legal fees.

Which type of insurance costs more? Landlord insurance will typically cost about 25 percent more than homeowner insurance for the same property. This difference in cost revolves around who is living in the property. The insurer knows that the owner will most likely take necessary precautions if he or she is living in the home rather than a tenant, which will prevent the homeowner from having to make future insurance claims. Because owners take an additional risk when tenants reside in their property, insurance companies charge more.

How can landlords reduce the cost of their insurance? Since landlord insurance on average costs more than homeowner insurance, it's a good idea to learn ways you can reduce your insurance premium. Here are a few tips. First, find out if your insurer offers any discounts for updates on your home — a new roof or better windows may provide savings from the policy provider, and it helps to upgrade your home. Second, consider how much you pay for your deductible; a higher deductible translates to lower premiums. Third, look at multi-policy and multi-location discounts if insuring more than one property.

Regardless of the price, you want to make sure that your landlord insurance offers the right coverage to safeguard your investment property. To find out more, go to steadily.com and get your commitment-free quote in minutes.