What is the Difference Between Landlord Insurance and Homeowners Insurance?

Written by April Weismann on 08/09/2018 01:56 PM in Homeowners Insurance,. Landlord Insurance.

When renting out a residence in New Hampshire, it’s important to make sure you have the right protections in place before any tenants move in. While there may be a few exceptions, you’ll likely want a landlord insurance policy. Here’s a look at how this type of policy differs from a typical homeowners insurance policy.

How Are Landlord Insurance and Homeowners Insurance Policies Different?NH Home insurance

Homeowners Insurance: Covering the Home, Belongings and Family

In order to understand how landlord insurance differs from homeowners insurance, it’s necessary to have a basic comprehension of the coverages that homeowners policies usually offer. As is true with most insurance, the coverages in both landlord and homeowners policies can vary depending on the company. Nevertheless, there are several protections that the majority of homeowners policies make available as either standard or optional protections.

Homeowners policies often come with lots of distinct coverages, but three primary ones serve to illustrate the differences between landlord and homeowners policies. The three primary coverages are:

  • Dwelling Coverage, which normally covers a policyholder’s house

  • Liability Coverage, which normally covers certain liability risks family members may face

  • Personal Property Coverage, which normally covers family members’ personal belongings

NH landlord insurance

Rental Property Insurance: Covering Properties and Landlords

Each of the above three main coverages can be taken in turn to show the fundamental differences between homeowners insurance and rental property insurance policies in New Hampshire.

First, some coverages found in rental property policies are very similar to their homeowners counterparts. Dwelling coverage is an example of this. It usually protects the main building on an insured property regardless of whether it’s found in a homeowners or rental property policy. The limits, terms and conditions might vary slightly, but the coverage’s fundamental purpose remains the same -- to protect the dwelling itself from covered perils.

Second, the liability protections found in each type of policy can vary even though both policies usually offer liability protection.

In homeowners policies, liability coverage is often extended to the named insured and resident family members but limited to personal risks. For example, a homeowners policy might cover lawsuits arising from a dog bite that the policyholder's pooch inflicts.

The liability coverage included in rental property policies tends to be limited to the insured premises itself and typically only covers the named insured, which is the landlord. For example, if a tenant had a party and a guest slipped and fell because of a skate board the tenant left in the living room, the landlord's policy may not pay out on a potential lawsuit as there has to be negligence on behalf of the landlord.  The tenant would need to have their own renters policy to defend them and pay out any potential damages.  (Which is why every landlord should insist their tenants have renters insurance.)

Finally, some coverages in homeowners policies simply aren’t normally found in rental property policies. Likewise, some coverages in rental property policies aren’t usually included in homeowners policies.

Personal property coverage is the best example of this. Most rental property policies don’t have it because tenants are responsible for insuring their own belongings, and again need renters insurance.

If the landlord has personal property in the rented premises, like a refrigerator, washer, dryer, etc. this coverage would need to be added separately as it is not typically included.

Get Landlord Insurance for Your New Hampshire Property

If you rent a residence in New Hampshire, regardless of whether it’s your home or an investment property, make sure you’re protected with a landlord policy. Don’t be one of the many homeowners who rent their house without realizing they need to adjust their insurance coverage.  You may not only have less coverage should a claim occur, you may not have any coverage given homeowners insurance is only intended for an owner-occupied dwelling.  If the property in question does not meet this criteria, the carrier can deny a claim, no matter how large or small.

Contact the insurance agents at HPM Insurance for help getting a rental property policy that has the protections you need.

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