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Carley Clark is a freelance financial writer based in Michigan. She has written for several well-known brands, including Benzinga, CNN Underscored, GOBankingRates, and FinanceBuzz. Carley earned her bachelor’s degree in business from Spring Arbor University in 2018 and later worked as a revenue auditor for a casino before transitioning to writing. Outside of work, she enjoys reading, playing video games, and going for walks with her dog.
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Sara Getman is an Associate Editor at Insurify and has been with the company since 2022. Prior to joining Insurify, Sara completed her undergraduate degree in English Literature at Simmons University in Boston. At Simmons, she was the Editor-in-Chief for Sidelines Magazine (a literary and art publication), and wrote creative non-fiction.
Outside of work, Sara is an avid reader, and loves rock climbing, yoga, and crocheting.
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If you’re renting out a home or investment properties, you might want to consider landlord insurance to protect your rental and your income.
A landlord insurance policy can cover tenant damage, liability claims, and certain disasters like fires or storm damage. It can also replace lost rent payments if your property becomes uninhabitable due to a covered event.[1]
Here’s what you should know about landlord insurance, including what it covers, add-ons and endorsements you should consider, and how to buy a policy.
Landlord insurance typically costs around 25% more than homeowners insurance.
Most lenders require landlord coverage if you have a mortgage on a rental home.
Policies don’t cover tenant belongings — that falls under renters insurance.
Landlord insurance, also called rental property insurance, is a policy for tenant-occupied dwellings. It usually includes three main coverage types: property, liability, and rental income protection.
Unlike homeowners insurance, which protects your personal residence, landlord insurance is specifically for rental properties. Standard homeowners insurance policies lack important landlord protections, so it’s best to call your insurance agent before renting out your home to see what type of coverage you need.
Some insurers allow short-term rentals of your primary residence, like renting out a garage or accessory dwelling unit (ADU), through an endorsement on your existing homeowners policy. But if you plan to rent regularly, like through Airbnb, you may need a business policy instead.
Long-term rentals, on the other hand, typically require a landlord insurance policy. This coverage provides broader liability protection and can even replace lost rental income after a covered peril, making it ideal for both seasoned real estate investors and landlords.[1]
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When you purchase landlord insurance, you receive protection from common perils like fires, storms, and water damage from burst pipes. If a qualifying event damages your rental property, the policy can help pay to repair or rebuild the structure.
Unlike homeowners insurance, many landlord policies cover lost rental income. This coverage can reimburse you for rent you’d normally collect while your property undergoes repairs. For example, if a kitchen fire damages one of your rental units, landlord insurance can compensate you for lost income while your tenant stays elsewhere.
Landlord insurance also provides liability protection if someone gets injured on the property. If your tenant slips on an icy sidewalk or trips on a loose step, your policy could help with medical bills, legal fees, and court-awarded damages.
Landlord property protection works similarly to dwelling coverage in a homeowners policy. It can pay to repair or rebuild your rental after a qualifying event. While policies vary, many cover the following perils:
Fire damage
Wind and storm damage
Lightning
Hail
Vandalism
Water damage from burst pipes
Accidental damage
This coverage can extend to attached structures like garages, decks, or patios. It can even replace appliances or fixtures that you own on the property.
When choosing a landlord insurance policy, it’s important to select coverage limits equal to the property’s replacement cost, or the amount it would take to completely rebuild. If you have a mortgage on your rental property, the lender may require this coverage.
Liability coverage protects landlords from legal and medical expenses if someone gets hurt on their property.
As a landlord, you’re legally obligated to provide tenants with a safe and livable environment. Still, it’s easy to overlook minor things, especially if you manage multiple rental properties. Here are a few situations where landlord personal liability coverage could protect you:
A maintenance worker mops the entryway, and a tenant slips and breaks their ankle.
A poorly installed ceiling fan falls on a tenant.
A leaking pipe damages a tenant’s belongings, and they sue you for the replacement cost.
If your rental property becomes uninhabitable after a covered event (like a fire or storm), your tenants may need to stay elsewhere while you repair the building. During that time, you won’t be able to collect rent.
Some examples may include:
Smoke damage from a wildfire makes the air unsafe to breathe. Your tenants move out until the unit is clean.
A frozen pipe bursts and floods the apartment. Your tenants have to leave while the water damage is repaired.
A tree branch falls and damages part of the roof and side of the building. Your tenants have to evacuate the property until it’s safe to return.
Rental compensation coverage, also called fair rental value insurance, helps you recover that missing income. After a covered peril, your insurer can reimburse you for the market-rate rent your property would normally earn.
Since homeowners insurance doesn’t include lost rental income reimbursement, this protection is essential to any landlord policy. It’s important to note, though, that it won’t cover vacancies, evictions, or market downturns.
Landlord insurance won’t cover every instance of damage. It has exclusions to limit the insurer’s risk. Here are some common situations landlord insurance typically won’t cover:
Tenant belongings: Tenants have to buy renters insurance to protect their belongings.
Appliance breakdowns: Coverage usually doesn’t include normal wear and tear.
Flood and earthquake damage: These perils generally require separate policies.
Mold or pest infestations: This is typically excluded unless a covered event causes it.
Intentional or long-term neglect: Most policies don’t cover damage caused by a property maintenance issue or poor upkeep.
To fully protect your investment properties, consider purchasing additional insurance coverage for floods, earthquakes, equipment breakdowns, and missed rent from tenants.
The main difference between homeowners and landlord insurance is who occupies the property. Homeowners insurance generally protects an owner-occupied residence, while landlord insurance covers tenant-occupied properties.
If you start renting out your home, or even just a room or basement suite, you may need more coverage than your standard homeowners insurance policy. Renting introduces new risks, like tenant damage or liability claims, that regular homeowners insurance typically doesn’t cover.
Landlords who move out and rent their property long-term will likely need to switch to a landlord policy. If you’re just renting out part of your home, though, you should ask your insurer about adding an endorsement to your existing homeowners coverage.
Coverage Factor  | Homeowners Insurance | Landlord Insurance |
|---|---|---|
| Occupancy | Owner-occupied | Tenant-occupied |
| Structure coverage | Covers your home and attached structures | Covers the rental home and landlord-owned structures |
| Personal property | Covers the owner’s belongings | Covers landlord-owned items (like appliances or furnishings) but not tenants’ possessions |
| Liability | Protects you if a guest is injured | Protects you if a tenant or guest is injured |
| Loss of income | Not included | Reimburses lost rent if the property becomes uninhabitable after a covered event |
| Cost | Generally lower | Usually higher due to increased risk |
Just like how you can customize a homeowners policy with riders, you can also choose optional add-ons for landlord policies. A landlord endorsement can fill gaps in coverage to provide more complete protection.
Here are some add-ons or endorsements you may want to consider:
Umbrella insurance adds extra liability protection beyond your base policy. It can help with large legal judgments that exceed your primary liability limits.[2]
Law and ordinance coverage pays for upgrades required by new building codes, such as rewiring after a fire to meet current standards.
This coverage pays for repairs or replacements of systems like HVAC or water heaters.
This coverage protects against intentional damage from tenants or intruders if your policy doesn’t already cover it.
Short-term rental coverage extends protection for short-term or Airbnb-style rentals.
Water damage coverage protects you from sump pump or drain backups if your base policy doesn’t include it.
This endorsement maintains coverage while a property sits empty between tenants.
Landlord insurance can cost around 25% more than a standard homeowners policy. It’s more expensive because rental properties carry greater risks, including tenant damage, higher liability exposure, and loss of income.
The price of landlord insurance varies widely depending on factors like location and coverage selections. Annual premiums generally range between $600 and $3,000 but could exceed $4,000 per year in certain regions or for high-value homes. The higher cost helps insurers manage their financial exposure while you’re renting out the property.
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Many factors can affect how much landlord coverage costs. Here are some of the most common factors insurance companies consider:[3]
Location: Homes in areas prone to theft, flooding, or severe weather cost more to insure. You can add security systems or weather-proofing to reduce the risk.
Property age and construction: Older or poorly maintained buildings often have higher premiums. Keeping up with maintenance and upgrading electrical and plumbing systems may lower premiums.
Coverage limits and deductibles: Higher limits increase premiums, while higher deductibles lower them. Choose the highest deductible you would comfortably be able to afford to lower your monthly insurance bill.
Claims history: If you’ve made frequent claims in the past, it can raise your landlord insurance rates. Consider taking care of small issues yourself so you won’t have to file a claim.
Purchasing landlord coverage is similar to buying homeowners insurance. Here are the typical steps to get a policy:
Gather property details. The insurer may ask about your property’s location, size, age, and rental type, such as single-family, duplex, or ADU.
Decide your property coverage needs. Determine how much protection you need for the structure, liability, and lost rental income.
Get multiple insurance quotes. Request insurance quotes from several companies to compare rates and coverages. We found that most insurance companies require a phone call to receive a quote instead of offering online estimates.
Review exclusions and limits. Look for gaps in coverage, like mold, flood, or earthquake exclusions, to decide if you need add-ons.
Compare deductibles and discounts. High deductibles usually lower your premiums. You may be able to get discounts for security or safety upgrades.
Purchase your policy. Once you decide which coverage and price is best for you, contact the insurance company to sign up.
Landlord insurance offers vital protection for those renting out a home or property. Below is some additional information about rental property insurance to help you decide if it’s right for you.
Yes, it’s typically worth getting landlord insurance for your rental property. This coverage can protect the building, your liability, and your rental income after covered events.
No. Landlord insurance covers only the property’s structure and items that you own, like appliances. Many landlords require renters insurance as part of their rental contract to protect tenants’ belongings.
The best insurance for landlords will cover the property, liability claims, and loss of rent. Landlords might also want to consider endorsements for equipment breakdown, theft, vandalism, and water backups.
Landlord liability insurance can cover legal expenses and medical bills from claims. For example, if a tenant slips on the stairs of your building, it could pay for hospital expenses, attorney fees, and court-awarded damages.
Landlord insurance typically doesn’t cover tenant belongings, appliance breakdowns, floods, earthquakes, mold, pest infestations, or neglect. You may be able to purchase add-ons and endorsements to cover some of these instances.
Insurify data scientists analyzed rates from more than 180 home insurance companies sourced directly from Insurify’s partner companies and Quadrant Information Services. Rates span all 50 states and Washington, D.C., and quote averages represent the mean price for a given coverage level and geographic area. To ensure data reliability, only insurers meeting minimum quote thresholds were included in the analysis.
Unless otherwise specified, quoted rates reflect the average cost for homeowners with no prior claims and good credit with a home construction year of 1980. The default coverage assumptions include:
Default Coverage Assumptions
Additional data points beyond these default values are sourced from Insurify’s proprietary database. Rates are updated monthly.
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Carley Clark is a freelance financial writer based in Michigan. She has written for several well-known brands, including Benzinga, CNN Underscored, GOBankingRates, and FinanceBuzz. Carley earned her bachelor’s degree in business from Spring Arbor University in 2018 and later worked as a revenue auditor for a casino before transitioning to writing. Outside of work, she enjoys reading, playing video games, and going for walks with her dog.
Sara Getman is an Associate Editor at Insurify and has been with the company since 2022. Prior to joining Insurify, Sara completed her undergraduate degree in English Literature at Simmons University in Boston. At Simmons, she was the Editor-in-Chief for Sidelines Magazine (a literary and art publication), and wrote creative non-fiction.
Outside of work, Sara is an avid reader, and loves rock climbing, yoga, and crocheting.
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