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Homeowners' Policy

If you're simply looking to protect your family home, you can use homeowners' insurance policies, which will typically cover hazards such as fire, lightning, wind, hail, liability, personal injury, and even medical coverage (coverage may vary depending on the policy) However, landlords and tenants have to take advantage of specific property insurance types aimed at them.

Landlord Insurance

Since renting out your property is actually a business, a homeowners' policy will not provide coverage for this purpose. You need to get specific landlord insurance, and while it may seem expensive, it's highly recommended. As with any property insurance, you pay a predictable amount on a regular schedule, and you won't have to pay out of pocket if there are unexpected damages to the property that are covered by your policy. The extent of coverage depends on the individual policy. Basic policies will typically cover damage to the property you rent out, but will not extend the protection to furniture, appliances, or other items that are a part of the property you rent. The coverage can be extended to protect these things and you can also get additional coverage for water damage (due to plumbing system breakage, spillage, sewage backing up, flooding, etc.), legal costs, loss of income and more.

Renters' Insurance

Some states mandate that tenants take out renters' insurance, but even if your state doesn't, it's a very good idea to purchase an insurance policy as a renter or obligate the tenant to purchase one as a landlord. The most basic reason is that the landlord's insurance does not cover the property of the renter, even under expanded coverage. As such, if the renter's property is lost along with the landlord's, the latter will benefit from insurance payments, while the former will be forced to cover the costs out of their own pocket. The extent of coverage for renters' insurance varies depends on the policy and the circumstances of the loss.


Before committing to any property insurance policy, especially as a business owner, it's a good idea to consult your local regulations, ensuring that you comply with the law and obtain any mandated coverage. Whether you're a homeowner, landlord, or a renter, you should always read the insurance agreement in detail before you sign on the dotted line. Have a question about insurance or compliance with local laws? Ask a lawyer.

This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.

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