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West Palm Beach Business & Personal Injury Attorney
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Understanding Your Landlord’s Insurance Policy

Renting property you own can be a fantastic way to earn more income and, as it is for many, can be a key to financial freedom. One of the most important things you can do to ensure that you protect the financial flow you are receiving from renters to have an adequate landlord’s insurance policy. If something were to happen to the property and you have a homeowner’s insurance claim that is not a landlord policy, the insurance carrier may deny the claim and leave you with the bill. In order to ensure that you are doing the best to protect your investment, you should speak to an attorney.

When choosing a landlord’s insurance policy, there are some key provisions that you should pay attention to:

  1. Dwelling Coverage. Dwelling coverage ensures the physical structure of the home you are insuring and will provide for financial costs that are related to any structural damage, gas or plumbing systems, piping, cables, internal fixtures, and exterior blinds and awnings and other outdoor items. This is also known as fire insurance, which will enable you to buy coverage at various levels based on the value of the coverage you want. A key provision that you should pay attention to in regards to dwelling coverage is “Guaranteed Replacement Cost” coverage. This coverage will provide financial support to rebuild even if the cost of materials exceeds your original insurance amount.
  2. Flood Coverage. This coverage will help you pay for water damage to the building and anything inside for floods, rains, sewer issues, and other issues from water that does damage during natural disasters.
  3. Personal Property Protection. This protection is essential for furnished rental units because it insures the furnishings. It also insures against damage to flooring, curtains, and other light fixtures in addition to the furnishings.
  4. Acts of Nature. When natural disasters come into town, the damage is disastrous. In areas like Florida, hurricanes can cause major damage. However, it is important to weigh the costs of the policy against the cost of covering the damage; hurricane insurance in Florida is a significant expenditure and could be more than covering the costs to rebuild a home in some situations.
  5. Rental Default Insurance. The main reason for having landlord’s insurance in the first place is to protect your investment in your rental income. In the event that repairs or a disaster prevent you from collecting rental income on the property, this insurance enables you to collect in the equivalent of the rental amount for a specified length of time.
  6. Coverage for Liability, Legal, and Medical expenses. If someone at the rental property is hurt, they may sue you as the landlord for their damages. In the event this happens, you will want the proper coverage for the injuries of the person who was hurt, legal fees, and various medical costs of the injured individual. If you own multiple properties, you should consider an umbrella policy for further coverage.

The issues that landlords face are unique and sometimes complex. When you are faced with landlord-tenant issues, you may need legal help to navigate these issues to ensure that you do not end up coming out of pocket for expenses that you should not have to pay in full or picking up the bill for a bad tenant. If you want a partner in this process, contact Pike & Lustig, LLP. Our West Palm Beach business litigation attorneys can help you each step of the way.

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