A rental property can be a fantastic investment, providing passive income and an asset that will likely grow more valuable over time. However, a single fire or major weather event could wipe out the value of this investment, which is why you should consult with an insurance agent before your tenant moves in. Below are a few facts you should know about insuring a rental property.

What Type of Insurance Do You Need for a Rental Property?

Should You Buy Home Insurance?

Home insurance does protect a structure from covered perils, but it also includes liability coverage and additional benefits you don’t need if you’re renting out the property. Home insurance policies should be reserved for your primary residence to protect you, your family, and your possessions.

Property Insurance Coverage

If you’re renting out property on a long-term basis, talk to your insurance agent about purchasing property insurance, which covers only the structure itself. The standard policy will pay to repair or replace the entire building if it’s damaged by a fire, serious storm, or the carelessness of your tenants. If your tenants want equivalent protection for their possessions, they’ll have to purchase a renters insurance policy.

Short-Term Rentals

Renting out your home on a short-term basis has become a popular way to generate additional income, but what if an accident occurs while you’re away? Many home insurance policies will pay for any damage, even those caused by tenants, as long as your company receives advance notification. In other cases, you may have to purchase an additional rider to cover your guests, or purchase a business insurance policy if you intend to rent on a regular basis.

As Somerset, KY’s most trusted agencies, Cundiff & Company Insurance employs an experienced team of insurance agents who will ensure you get the coverage you need. They’ve been serving clients throughout the area for over 40 years, offering high-quality products that protect what matters most to you. Visit their website to learn more about their property insurance services, and call (606) 679-8379  to speak with an insurance agent and request a free quote.