Insurance

The Best Landlord Insurance Companies of 2022

The Best Landlord Insurance Companies of 2022

For many, the best way to start investing in real estate is to rent out a second home or apartment. However, it’s important to protect that investment while doing so. Landlord insurance works like homeowners insurance in that it offers protection for the property’s structure for certain covered events. It also provides protection for the landlord if a tenant is injured on the property and the landlord is found legally responsible. Unlike homeowners insurance, though, landlord insurance does not generally offer personal property coverage for items inside the home that belong to the renter, which is why landlords should encourage or require their tenants to get renters insurance. However, landlord insurance may offer coverage to protect any equipment that lives on-site and is used to maintain the property, such as a lawn mower or pressure washer, provided it belongs to the landlord and not the tenant. Landlord insurance can also offer coverage for loss of rental income if the property is uninhabitable during repairs following a damaging event covered by the policy. Finding the best landlord insurance starts by finding the best landlord insurance companies.

What to Consider When Choosing One of the Best Landlord Insurance Companies

When shopping for the best rental property insurance, it’s important to find a company that provides affordable coverage where the property is located. Choosing a company with a strong AM Best rating is a good indicator the company will pay its claims as agreed. Of course, it’s also important to select a company that provides great customer service.

Coverage Area

Not every landlord insurance company offers coverage in all areas, so start by looking for a company that provides insurance coverage where the rental property is located. This will help narrow down the available choices of the best landlord insurance companies.

It’s also important to understand that the location of the property could affect the price of landlord insurance. For instance, properties located within metropolitan cities are typically more expensive to insure than those in rural areas because of the difference in property values and the higher likelihood of a landlord making a claim. Likewise, if the property is located in a high-crime area, landlord insurance rates could be higher given the increased risk for damage to the property.

AM Best Rating

A key consideration when shopping for the best landlord insurance companies is finding a company that will pay its claims as agreed. AM Best, a well-known credit rating agency that specializes in insurance companies, reviews credit ratings, financial data, and other research to determine a company’s creditworthiness and financial strength, which is a good indicator of whether the company is able to pay its claims.

When reviewing AM Best ratings, look for companies with a score between B+ (good) and A++ (superior). Companies could receive scores between B (fair) and D (poor), but those lower scores generally do not speak well about their ability to pay their claims to policyholders.

Standard Coverage vs. Additional Coverage

As with all insurance products, each landlord insurance policy from different companies offers a variety of coverages, either standing in a basic policy or offered as additional, optional coverage. Standard coverage is generally found in most landlord insurance policies and typically includes dwelling coverage and liability coverage. A basic policy may also include coverage to protect the landlord’s personal property, such as a lawn mower that’s stored on the property for a tenant’s use, or large kitchen appliances, which are located at the home.

Additional coverage can be purchased to supplement the standard coverage so the landlord’s property is more fully protected. For instance, burglary coverage could help pay to replace a lawn mower if it gets stolen, but only after the deductible is met. Coverage for vandalism is often available for an additional cost.

Quote Process

Shopping for quotes is an important part of finding the best landlord insurance policy. Having quotes to compare is useful to help find rates that are affordable, so look for companies that make it easy to get a quote. Many landlord insurance companies have an online quote tool wherein users enter the requested information and a quote is generated. Additionally, quotes are often available by phone or through a local agent to give customers a more personalized quote for their specific needs.

Keep in mind that quotes are an estimated cost of what landlord insurance could cost, not an exact price. Most likely, the exact price for a landlord insurance policy will not be available until it’s time to actually make a purchase.

Discounts

Insurance companies are known for providing discounts to help policyholders save on their rates, and landlord insurance companies are no different. The most common discount is for bundling two or more insurance policies together, such as landlord insurance and an umbrella insurance policy (which provides coverage in excess of the limits provided by existing policies and is intended to protect the policyholder in the event of a large or potentially financially devastating claim). But there often are many more discounts to be had that are specific to the insurance company and the landlord’s personal situation.

For instance, many insurers offer discounts for having a home security system in place, which could help reduce premium costs. Policyholders who purchase their landlord insurance from the same company where they have other insurance policies also may receive a loyalty discount. It’s important to ask the company or agent about all available discounts to maximize savings.

Claims Process

Nobody wants to experience a situation that necessitates having to file a claim, but if it happens, they want to know that their landlord’s insurance company will process the claim quickly so repairs can start. Therefore, it’s important to find out not only how easy it is to file a claim but also how status updates will be provided and how quickly a claim may be resolved.

Many insurance companies today offer the capability to file a claim online, by phone, or through the company’s mobile app. Status updates also may be available by going online or logging into the app. A streamlined claims process is essential to resolving a claim as soon as possible.

Customer Service

Obviously, finding a landlord insurance company that provides excellent customer service is essential. After all, no one wants a company that disappears once the policy premiums are paid. When shopping for landlord insurance, talk with other landlords if possible to see who they recommend for good customer service. If reading online reviews, take them with a grain of salt since many customers only take the time to write a review after a negative experience. A better gauge with which to judge the company is how these negative reviews are handled, so check to see if the company responded and what it said to try to right the situation. No insurance company is perfect, but if it works to resolve customer concerns then it is likely to be worth looking into.

Also, check customer service reviews with the Better Business Bureau. Not only does the BBB site show what customers have to say about a company’s customer service, but it often also shows an update on how the claim was resolved. This can provide crucial insight into how a landlord insurance company treats its policyholders.

Our Top Picks

When researching the best landlord insurance companies, it’s important to find companies that offer the necessary coverage at affordable rates, have strong AM Best ratings, and make it easy for policyholders to get a quote or file a claim. The following meet all of these requirements and more.

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