What changes
- Liability exposure as a landlord
- Loss of rental income after a covered loss
- Less personal property in the unit
- Tenant's own renters policy for their belongings
Short-term rentals
Short-term and vacation rentals are treated differently from annual leases, and many associations restrict them. Tell the insurer exactly how the unit is rented.
Landlord forms and endorsements
When a unit is rented out, insurers often switch from an owner-occupied HO-6 to a rental unit or landlord form, or add an endorsement that adjusts the policy for rental use. The building interior you are responsible for under the bylaws still needs a dwelling limit, but personal property coverage usually drops to what you leave in the unit, such as appliances or furniture in a furnished rental.
Loss of rents
Fair rental value or loss of rents coverage can pay the rent you lose while the unit cannot be occupied after a covered loss, such as a fire or a burst pipe. Check the time limit and whether it applies when damage starts in another unit or a common area.
Liability as a landlord
As a landlord you can be sued for conditions inside the unit, such as a loose railing or a faulty smoke detector. Keep the unit in good repair, document inspections between tenants and respond to repair requests in writing. Some owners add a personal umbrella that extends over rental units.
Association rules to check
- Minimum lease terms and any short-term rental ban
- Registration of tenants with management
- Insurance requirements for owners who rent
- Who pays the master policy deductible for damage from a rented unit
Frequently asked questions
Should my tenant have insurance?
Many owners require tenants to carry renters insurance with liability coverage.
Does my tenant's renters policy protect me?
Not directly. It covers the tenant's belongings and liability. Your own landlord coverage protects you and the unit.