Arkansas landlord insurance is similar to a standard homeowners insurance policy but with a few distinct differences. Once you begin to rent out your property it is a good idea to switch your insurance from a homeowner's policy to a landlord policy. This will insure that in the event of a claim the company will pay out instead of denying coverage due to the rental status of the home.
A landlord insurance policy in Arkansas will include the following items that are not covered on a standard home insurance policy:
- Landlord liability insurance - covers your liability as a landlord in the event you are held liable for property damage or tenant injuries from the lack of maintenance.
- Loss of rents - will pay for the loss of rental income while the property is being repaired to living condition.
It is easy to get this protection and we can provide a free and fast way to connect with multiple insurance companies that offer landlord policies. Just enter your zip code above to start the application process and in just a few minutes you will begin to receive landlord insurance quotes from trusted insurance agents.
Landlord Building Insurance in AR
Landlord building insurance is the primary coverage offered on most policies. This will provide protection against common threats such as hail, wind and fire just to name a few. If you own a rental property that is a single family home you know that you are responsible for the maintenance of the home including the roof, exterior walls and attached structures. Having the proper building insurance will cover these parts of your home and you will only need to pay the deductible.
Dwelling coverage and landlord building insurance are very similar but the latter is specific to a rental property insurance policy. If you have tenants living in your property you must inform the insurance company so there is nothing excluded at the time of a loss. It is not uncommon for a landlord to make a claim with the insurance carrier just to find out that they will only cover a small portion of the loss since the owner did not inform the insurer of the rental status.
Investment Property Contents Insurance
Landlord contents insurance is simply a way to protect the stuff you leave in a rental property such as furniture and appliances. Many landlord insurance policies will provide a small amount of contents insurance but you can always increase or decrease this amount based on how much personal property you store at that address. If you don't furnish the unit and there is only a few small items in the home just have the insurance agent reduce this coverage to a minimum so you can save more money.
On the other hand if you furnish the building with your own belongings be sure to have enough coverage to pay for new replacement items. This is very important because if a total loss occurs from a fire or other covered peril you want to be able to replace those items at today's cost.
Cost of Landlord Insurance in Arkansas
The cost to insure your rental property in AR 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 AR
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.
Arkansas's 5 largest cities by population
City - Population
Little Rock 193,524
Fort Smith 86,209
Fayetteville 73,580
Springdale 69,797
Jonesboro 67,263
*Data from 2010 Census Population by the Department of Economic and Community Development.
Common Landlord Insurance Claims in AR (Arkansas)
Wind
(Most claims cost over $3,000 to repair wind damage)
Fire
(Most claims cost over $33,000 to repair damages from fire)
Water
(Most claims cost over $3,500 to repair damage from water)
Physical Damage
(Most claims cost over $3,500 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.
