When do you become a landlord? Maybe you live in a vacation destination area and lease your home during the high season. Your recent college graduate returns home and you decide to give him a taste of responsibility and charge him rent. You only go up to your mountain cabin a few weeks out of the year and rent it the rest of the time. Your mom and dad are visiting for the holidays and you park your RV in the driveway for their use. You’re an empty nester and decide to rent out Junior’s old room for some extra income.
These scenarios could or could not be construed as a landlord-tenant relationship, depending on your insurance company. Sometimes your standard homeowners policy will cover a tenant scenario, sometimes a policy endorsement is necessary, and sometimes a landlord policy will be needed.
Landlord policies provide property insurance coverage for any physical damage to the structure of the home caused by fire, lightning, wind, hail, ice, snow or other covered perils. It also offers coverage for any personal property you may leave on-site for maintenance or tenant use, like appliances, lawnmowers and snow blowers. The policy also includes liability coverage; if a tenant or one of their guests gets hurt on the property, it would cover legal fees, due to injury claims, and medical expenses.
Remember that, unless you told them, your insurance company did not consider any rental situation when your homeowners policy was issued. If you haven’t shared that information with them when you do take on a tenant, they still won’t know, and that could translate into denying a claim if one becomes necessary.
As with any insurance issue, your best bet is to talk with your insurance professional to see if any additional coverage is needed, as well as find out what coverage you now have. It’s always better to be safe than sorry.