Landlord Insurance

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Florida Landlord Insurance

Florida landlord insurance is sold by leading home insurance companies to offer better protection for rental property owners than a basic home insurance policy could offer. Landlords in FL understand that making a profit in the investment property business can be tough but rewarding. Protecting yourself and the business is simple if you have the right insurance policy for that rental unit.

With over 280 days a year filled with sun most landlords in other states wouldn't think that there would be much to worry about in Florida. Beyond the seasonal hurricanes rental unit owners still deal with strong wind and water damage like many other states. If you want to have proper protection you need to make sure you not only have a home insurance policy but a landlord insurance policy.

Landlord insurance in FL will protect you against liability claims and loss of rental income in addition to the basic contents coverage. What makes this type of policy different from a homeowner's policy is the ability to file for lost income from tenants due to a covered loss or the protection from lawsuits by your renters.

Does Landlord Insurance Cover The Tenant's Property?

Both the landlord and renter should have their own insurance policies for very specific reasons.

  • Landlord insurance will provide coverage to the landlord including the building property, owner contents, loss of rents and landlord liability insurance.
  • Renters insurance covers a tenant's personal property and liability.

For these two reasons each of you need your own policy because the contents of the renter are not covered by the landlord policy and vice versa. Many rental property owners will require that tenants get renters insurance. By doing this it will add another layer of protection in the event the tenant causes damage to the building or if something is stolen from the unit the renter's policy will payout.

Related FAQ - Should I require my tenants to carry renters insurance?

How To Save Money on Landlord Insurance in FL

Many landlords are always trying to squeeze every dollar in order to make a profit from their rental property. One of the ways to make more income from your unit is to minimize the insurance costs associated with renting your home. Landlord insurance is a must but knowing how to find the cheapest policy and the right coverage is important. The last thing you want to have happen is your building is damaged and you don't have insurance or you don't have enough to cover the full damage. This is often called being underinsured.

There are three key ways to save the most money on landlord insurance while getting the best protection.

  1. Shop for lower insurance rates each year - it is free to compare rates of other companies and it is always a good idea to know where your current policy stands compared to others. You may not change companies that year for various reasons but at least you know there are other options.
  2. Find a knowledgeable insurance agent who knows your rental market and can offer advice to further save you money but more importantly provide the best coverage. If you have the proper protection a claim will seem less stressful and that is worth its weight in gold.
  3. Ask for discounts. Make sure you ask for all the possible discounts you may be entitled to for your policy. Many insurance agents will forget to inform you of many discounts because the company they represent has way to many to remember or they are not aware of your current situation. If you have security systems or other items that could lower your rate always ask.

Cost of Landlord Insurance in Florida

The cost to insure your rental property in FL is dependent upon numerous rating factors that home insurance companies use to determine the proper premium. When you own a condo or townhouse the cost of landlord insurance is very minimal because usually you split that cost with the homeowners association which insurers the exterior of your unit. If you insure a single family home or rental complex then your insurance costs are going to be much higher due to the replacement cost of the building is solely your responsibility.

Here are a few of the most common rating factors that insurance companies use to determine your landlord insurance premium:

  • Credit rating - This is your personal credit rating which is similar to a FICO score but can be based on other specific criteria such as payment history and bankruptcy.
  • Location - The zip code or city that your rental unit is located in has a dramatic effect on your insurance premiums as companies who have big losses in those areas will increase rates to get profitable.
  • Building type - This can be numerous things including condo, single family, and townhouse including the materials used to construct the property.
  • Claim history - If you have one or more claims in the past 3 years as a homeowner most insurance companies will surcharge your premium. Some companies may not even accept your business if you have more than two.
  • Discounts - If you have more business with an insurance carrier they are more likely to offer discounts to keep all of your business with them.

How to Find The Cheapest Landlord Insurance in FL

Each insurance company is different in the way they determine your rate and how much the average policy will cost but here are ways to ensure the lowest cost premium based on the factors above.

  • Good Credit - The better your credit the lower the cost of your insurance. Many states are now allowing credit as a rating criteria so get used to it being used. Try to keep your past payment history spotless and a FICO score above 720 is considered excellent.
  • Improve the Location - There is not much you can do about the location once you have purchased the rental property but be sure to keep the home well-kept and surrounding trees cut back to minimize potential hazards. The better your property appears the lower the cost to insure it will be.
  • Building type - Condo and townhouse owners will likely have a home owners association which will cover the exterior of the home so you are only responsible for the interior. This can save you hundreds of dollars each year. If the unit includes custom building and expensive materials expect to pay more because the cost to replace those items is greater.
  • No Claim history - Try not to make a claim if it is a small value of $2000 or less. Most companies look at multiple claims as a sign that you are prone to making claims in the future. If you are deciding whether to make a claim or not contact your insurance agent and ask them personally. Don't call the claim department and ask them because they are likely to document the call and file it for future use.
  • More Discounts - Ask about multiple policy discounts and the combination of auto and home insurance. Sometimes combining your personal auto insurance with this policy can save you 20-30% off each policy.

Florida's 5 largest cities by population

City
Population
Jacksonville 821,784
Miami 399,457
Tampa 335,709
St. Petersburg 244,769
Orlando 238,300

*Data from 2010 Census Population by the Department of Economic and Community Development.

 

Common Landlord Insurance Claims in FL (Florida)

Wind
(Most claims cost over $6,000 to repair wind damage)

Water
(Most claims cost over $6,800 to repair damages from water)

Physical damage
(Most claims cost over $3,700 to repair damage)

Lightning
(Most claims cost over $2,200 to repair physical damages to property)

NOTICE: The amounts listed above are for illustrative purposes only and should not be used to decide what coverage limits you need for your landlord policy. Speak with your insurance agent to determine the proper coverage limits.

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