If you rent an apartment or home to others and a fire occurs, will your Rental Property insurance policy fully cover your losses?
Landlords are urged to review their insurance policy to make sure they are properly protected in case of a fire or other catastrophic loss that could make a rental unit uninhabitable.
Standard landlord property insurance policies allow for 10 percent of the dwelling coverage for loss-of rents coverage.
Loss-of-rents is the amount a landlord-owner loses while waiting for the rental unit to be rebuilt.
For example, if your rental home is insured for $100,000 and the property burns to the ground, your insurance company allows $10,000 for loss-of-rents coverage.
In many cases, it can take up to 12 months to rebuild a rental home or apartment complex from a catastrophic loss.
If a loss does occur, $833 would be the approximate amount available per month for loss-of-rents.
If you are now renting the property for greater that this amount, you will have a shortfall in coverage.
CHECK OUT YOUR POLICY! The 10 percent automatic coverage offered by your insurance company might not be enough to cover your loss.
We strongly suggest you review your policy to ensure that your coverage is adequate to cover your property in the event of a loss.
The extra coverage cost is minimal and well worth the coverage protection.
We recommend you take the time to review your policy coverages as your company grows with your agent or broker.
It's also important to shop your insurance premium and coverages to see if you have the best available...
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