Any time you decide to start renting out property there will always be a chance for controversy of some sort to emerge. You will find the need to screen your tenants to ensure that they will be able to pay, are gainfully employed and reliable, and will remain so for the foreseeable future. There are many concerns that arise when it comes to tenants, but if you are careful in your selection and lay down a number ground rules that can serve to protect your interests you should be okay.
Obtaining the right type of insurance for your needs as a property manager is vital to becoming a landlord. You will need to be fully aware of which type of insurance will benefit you the most, which will work best in the long term, and what benefits you as a landlord, not just a homeowner. There is a big difference between being a landlord and a homeowner, as the insurance you need will not always cover serve as a catch-all for every situation that might occur. You want to be as protected as you can be, but still not pay for any insurance that will offer little to no benefit. There are a large number of tips that you as a landlord and property manager will need to research and decide upon but here are 8 crucial ideas that you should mull over.
8 Insider Tips for Landlord Property Insurance
Here are just a few things you might want to know before really jumping into the role of a landlord.
1) Avoid making any claims on a landlord policy unless you absolute need to.
ascentpm.com, a respected business in the property management sector told us: “In the event of property damage, make certain that the level of harm is significant enough to make a claim, otherwise let it be and take care of it out of pocket. This is crucial when thinking about making such a decision, much as it would be with an automobile. If you can take care of the damage without making a claim then do so.”
2) Always work with referred professionals.
By working with those that have been in the business and experienced success you can be certain that you are learning from the best. This will allow you to learn the do’s and don’ts in a safe and effective manner.
3) Avoid the toll-free line.
If you do have questions that are insurance-based, then seek another source for your preliminary questions. The average call will be charged and become another expense that you don’t need. If you need information there are plenty of ways to go about getting it. So stay off the toll-free line until you need to speak to the insurance reps.
4) Think about increasing your deductible.
This is largely done due to the fact that many claims are far and few between. The more you bump up your deductible the more you will eventually be able to claim when that time does come. It’s just smart business.
5) Make sure you have sufficient coverage to start over if you need to.
Accidents happen, life happens, and it’s always important to have what you need to pay the bank. Barring that you will need enough to tear down and rebuild.
6) Make sure you get property as well as liability insurance.
It’s not enough to just insure the grounds and the house itself. You need to be prepared if a tenant somehow gets hurt or has an accident. Too many landlords have been found at fault when their tenants somehow injure themselves and there is no liability insurance to cushion the blow.
To keep your insurance current and make your insurance agent happy you will need to keep up your property and insure that it is up to code. An insurance company can easily drop you if they deem that the home or the grounds are not safe for the tenant.
8) Keep an open line of communication with your agent.
Make sure you keep with every policy change that might come along. Keep in touch with your agent to make sure that your property is in compliance at all times and just in case there are any changes to your coverage.
Being a landlord is not an easy job, but it can be rewarding if you do it right. Make certain you have the right coverage.