Renting out rooms and properties is an increasingly common method of adding an extra stream of revenue. However, with this method comes the need for rental property insurance, also known as landlords insurance. In a perfect world, tenants would always pay rent on time, take good care of the property they're renting, and conduct themselves accordingly.
Sadly, the world is far from perfect, which makes the obtainment of rental property insurance absolutely critical. In some cases, homeowners policies automatically provide this type of insurance, but sometimes they don't. In the event of the latter, the individual who is renting property is tasked with the responsibility of securing landlords insurance.
Determine Which Type of Landlords Insurance is Needed
As affirmed by
The Huffington Post
, there are a variety of rental property insurance policies. Making the right investment is very critical. In many cases, sitting down with a financial advisor is a good idea prior to purchasing rental property insurance. Getting a professional opinion allows landlords to make the most informed decisions and get additional insight before making payments. Different policies cover different events; complete awareness of which landlords insurance is best for you is always preferable to purchasing the wrong insurance and having to do damage control at a later date and time.
Have Some Money Stashed Aside
Although costs of rental property insurance vary, there are some determining factors, explains
. Physical and geographical location, area quality, tenants, physical conditional, etc will each play a role in how much renters have to pay for insurance.
For this reason, having a certain amount of funds put aside (preferably a few thousand dollars, at the very least) can prove to be helpful. Moreover, landlords insurance can be quite pricey; therefore, renters should make sure that they are in a financial position to comfortably make this purchase.
Find Out if You Qualify for Any Discounts
Despite the fees associated with landlords insurance, certain companies and policies do offer various discounts under the right circumstances.
is one insurance agency which provides discounts, provided that renters meet certain criteria. Early shopping, new property, and mutual policy purchases can make one eligible for certain discounts. This is certainly a matter which landlords should ask insurance companies about. Making the most of an opportunity to save money almost always wields benefits.
A Final Word
The process of purchasing renters property insurance should not serve as a deterrent from landlords who are considering renting to tenants. Not only is renting out rooms and property an excellent revenue stream, but it's also a great business opportunity.
As a matter of fact, renting out property has become a prevalent part of the gig economy; many individuals rent out rooms or even entire homes and apartments on Airbnb.
Authored by Gabrielle Renee Seunagal