Renting out an investment property to tenants is a popular way to earn extra income. There are plenty of decisions to make during the rental process, many of them regarding how to fix up the space or who to rent to. However, it’s important to remember to protect yourself and your assets before new lessee moves into your property.
What is landlord insurance?
For the most part, you can expect tenants to be courteous to you and your property. This means they’ll pay the rent on time, keep the home in good repair, and avoid causing major damage. But, of course, there is always the chance that the residents won’t have the respect you expect for your investment property.
Like any investment, there are financial risks that come with letting a home out to tenants. Because of this, many owners opt for landlord insurance, which is a type of policy that covers investment properties. It protects against myriad risks that landlords may encounter:
In addition to the damage that residents can do to the space, there are always the dangers that come with any property: fires, floods, and other natural disasters. Depending on the policy you choose, your landlord insurance may protect you against such events.
Do you need landlord insurance?
You can be as thorough as you’d like when you’re vetting your potential lessees, but it’s impossible to foresee the future. Whether they experience job loss or another emergency that keeps them from being able to pay the rent, or they invite more reckless guests over who could do physical damage to your property, it’s always a good idea to protect yourself and your assets with landlord insurance.