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Q&A: How Much Does Rental Property Insurance Cost?

Posted by Parker Beauchamp on Aug 04, 2017


There are 111,271,029 renters in the United States and 22,857,491 landlords. With numbers such as these, it’s apparent the rental property industry can serve as a good, quality investment. But, how solid is your investment without the proper protection in place? Additionally, how much does it cost to keep your investments profitable and rental operations running smoothly?

To answer these question and more, we interviewed INGUARD vice president Emerson Poort. Poort specializes in property/casualty risk management and insurance consulting for real estate, rental and leasing.

Let’s dig deeper into how much it could cost you to keep your rental property safe from harm and what affects the price.

1. What are the most common risks and liabilities associated with rental property insurance?

While rental properties can serve as a secondary or even main source of income for landlords, there are risks and liabilities that could arise, setting back operations. Some of the most common are:

  • Accidents on the property (e.g. weather or maintenance related).
  • Environmental damage to the structure (e.g. fire, wind, hail, flooding).
  • Injuries to employees.
  • Loss of rental income.
  • Theft and burglary.
  • Tenant discrimination.

While the above risks are the most common, there are some that are also often overlooked, but shouldn’t be ignored. For example, rental property managers often don’t insure properties to true value. It’s common for landlords to underinsure due to feeling they should only insure at market value or what they currently owe for the existing loan.

It’s important that rental property owners sit down and properly evaluate how much their business is truly worth and its most essential assets. Not doing so can cost your business more in insurance claims and premiums in the long run.

2. What type of coverage is typically purchased to insure rental properties? 

To help protect your rental property from detrimental setbacks, there are some recommended coverages to consider. Top policies to purchase are:

These are just some of the most common coverages rental property owners should consider. However insurance plans will be unique to each business owner, which could remove or add specific policies to ensure maximum protection.

3. How much does rental property coverage on average cost?

Each rental property business will be unique, which means insurance plans should be tailored to fit specific needs. Due to unique plans, pricing can vary depending on a number of factors, such as location, number of properties, number of employees, etc.

For example, for a rental property that is non-coastal, a rate of 15 to 35 cents (per hundred dollars of coverage) is the range for apartment complexes. For single-family dwellings, it’s generally 25 to 45 cents per hundred dollars of coverage.

Before selecting any coverages to protect your rental property business, sit down with a trusted insurance provider to evaluate specific prices and amount of coverage needed.

Are you interested in learning more about coverage options for your rental property? If so, contact INGUARD for a free consultation with one of our experts.

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Topics: Business Insurance