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Landlord Insurance " vs homeowners insurance

Old 10-29-2014, 10:56 AM
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Default Landlord Insurance " vs homeowners insurance

wondering if we rent out moms house how much the insurance will go up. the present agent said they don't know and did not want to even guess .
home is now a homeowners policy but if we rented it out the insurance would have to change to a landlord policy, agent seemed to think it might be more expensive but would not even guess at the up charge even guess a magic wild estimates like 30% or 50% more..
anyone done this?
30% more for the landlord insurance??
Old 10-29-2014, 11:03 AM
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you need a new agent. He/ she can get you a dwelling fire policy quote in about 10 minutes.

I don't know what state you're in but the rates can vary depending on the amount of contents coverage you maintain in the property and the liability limits you choose. The policies price should not be drastically different than a homeowners policy in most cases though.
Old 10-29-2014, 11:08 AM
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Find a new agent it should take about a second to get a landlord policy

Probably looking at around 10% decrease in what you homeowners was.

Last edited by upstate jake; 10-29-2014 at 11:53 AM.
Old 10-29-2014, 11:34 AM
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Originally Posted by ProppedUp View Post
Agreed I would find a new agent.

The reason "the don't even want to know" is because it is cheaper.

My rental house's insurance is cheaper than if I lived there. One reason is because your not insuring any contents.
That's what I thought too. I've only heard that landlords policy was cheaper.
Old 10-29-2014, 11:46 AM
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Originally Posted by ProppedUp View Post
Agreed I would find a new agent.

The reason "the don't even want to know" is because it is cheaper.

My rental house's insurance is cheaper than if I lived there. One reason is because your not insuring any contents.
X2.
Old 10-29-2014, 12:29 PM
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Reasoning of Insurance Underwriters....

Homeowner protects his pipes during freezes.
Homeowner will not let a roof leak continue.
Homeowner will not start a fire to collect on his $2000 of furniture.
Homeowner will turn off the water in case of ruptured pipe in house.
Homeowner has decent credit and premium is somewhat factored into credit scores.
Homeowner is careful and not neglecting property.
Many other examples...

Basically, Underwriter figures more things happen when a Tenant is the one in possession.
Old 10-29-2014, 12:58 PM
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Originally Posted by ProppedUp View Post
Agreed I would find a new agent.

The reason "the don't even want to know" is because it is cheaper.

My rental house's insurance is cheaper than if I lived there. One reason is because your not insuring any contents.

New Jersey insurance agent here, so my answer is based on NJ only...

Though it is "possible" it could be cheaper because you are not covering contents, it is unlikely. At the same time, you want to make sure you do include some contents coverage for things like washer and dryer, kitchen appliances, etc.
As someone else stated, there are other risks associated with a home being rented out. Likewise, coverage should be different too. If you are renting the house out, you want to make sure "Loss of Rent" coverage is included, which covers you in the event a covered loss makes the home uninhabitable. This does not cover you if just can't rent it out or the tenant skips out on you.
But yeah, a dwelling fire quote like this would probably take about as long as it took me type this out.
Old 10-29-2014, 01:04 PM
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Okay, I went through this a couple of years ago. Apples to apples the landlord insurance is cheaper because You are not insuring contents.

When you get the the landlord policy it will be a new policy, not a revision on your existing policy. What happened to me is that the new policy required me to up my coverage due to new formula for new policies. So my insurance actually went up when I rented the house out, but was cheaper than if I were to get a new homeowners policy.
Old 10-29-2014, 01:54 PM
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Originally Posted by triguy7 View Post
Reasoning of Insurance Underwriters....

Homeowner protects his pipes during freezes.
Homeowner will not let a roof leak continue.
Homeowner will not start a fire to collect on his $2000 of furniture.
Homeowner will turn off the water in case of ruptured pipe in house.
Homeowner has decent credit and premium is somewhat factored into credit scores.
Homeowner is careful and not neglecting property.
Many other examples...

Basically, Underwriter figures more things happen when a Tenant is the one in possession.
this is what the insurance agent hinted at , that is, the renter does not care if it burns down or floods whereas the owner does--- thus landlord policy would be more.
Old 10-29-2014, 02:06 PM
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I am an agent in coastal Ga. Here the same things apply as mentioned before but it really boils down to carrier availability because of the coastal exposures. There are less companies that offer dwelling fire ( landlord) policies so the availability issues drive the pricing up in some cases. However you also need to be aware that if you have a homeowners policy in place and it is tenant occupied or not rated as a secondary residence if that's what it is then a claim could potentially be denied down the road if the current policy is incorrectly rated for the correct exposures. .

I stand my initial statement that if your agents initial response was to not do it right you need a new agent
Old 10-29-2014, 02:10 PM
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Originally Posted by Strike1 View Post
New Jersey insurance agent here, so my answer is based on NJ only...

Though it is "possible" it could be cheaper because you are not covering contents, it is unlikely. At the same time, you want to make sure you do include some contents coverage for things like washer and dryer, kitchen appliances, etc.
As someone else stated, there are other risks associated with a home being rented out. Likewise, coverage should be different too. If you are renting the house out, you want to make sure "Loss of Rent" coverage is included, which covers you in the event a covered loss makes the home uninhabitable. This does not cover you if just can't rent it out or the tenant skips out on you.
But yeah, a dwelling fire quote like this would probably take about as long as it took me type this out.
I'm an agent and agree with this answer. Its usually not enough to even worry about but if your along the coast that could be an issue.
Old 10-29-2014, 02:11 PM
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if thats what your agent said to you dump him or her.
Old 10-29-2014, 02:54 PM
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All things being equal, it MIGHT be a few dollars cheaper, but, I would count on about the same cost. Yes, with a "Landlord" Policy, you arent getting a bunch of contents property, most will give you some, however, where the rubber meets the road, is that these type of policies have a HIGHER loss ratio, therefore about the same price. Sacrificing contents coverage offsets the higher losses. Tenants, as we all know, dont take care of the property as well as the Homeowner does, therefore, higher losses.
Old 10-29-2014, 02:55 PM
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Originally Posted by upstate jake View Post
Find a new agent it should take about a second to get a landlord policy

Probably looking at around 10% decrease in what you homeowners was.
I agree, normally little cheaper since they are not covering contents
Old 10-29-2014, 03:37 PM
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Originally Posted by ProppedUp View Post
All I can say was I was living in a house and paying X amount for insurance. I moved into a new house and changed it to a renters policy and it went to 2/3 that amount. That was with State Farm. A couple years later I switched to Allstate and it dropped further to about 1/2 of what I was paying originally.

To be fair I had upped some of my contents coverages for example I think they cover something like 5k on guns;? Come on

But the added coverages didn't add up to the difference. So I think it should drop a little.

Bottom line is it doesn't matter what it is if you plan on renting your house you need a landlord policy and there needs to be a clause in your renters contract saying they must maintain renters insurance. Oh and no trampolines... etc.....
But my pit bull loves trampolines
Old 10-30-2014, 05:18 AM
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One more thing that you should consider if you do the rental...

Make sure your tenant provides you with a renters insurance policy for at least $10k..

The rates for them will be surprisingly low.
Old 10-30-2014, 10:43 AM
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Coastal coverage is high and a small number of carriers. One other policy I would buy is OL&T this cover liabilities not otherwise covered. It does sound like you need to look around for another agent.
Old 10-30-2014, 01:56 PM
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Originally Posted by triumphrick View Post
One more thing that you should consider if you do the rental...

Make sure your tenant provides you with a renters insurance policy for at least $10k..

The rates for them will be surprisingly low.

Who cares about their contents? You should make it part of the lease requirement that they have liability coverage of at least $300,000, if not $500,000. And they should provide evidence of coverage every year. Tenants coverage in NJ (depending on their contents limit) would be $150-$200 a year.

This way if they burn the house down, you have a true means of recovery, not just your policy.

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