Anyone that does business with rental units, whether hotels, condos, boarding houses, or home leases, should consider the value of purchasing habitational insurance. This is a unique insurance plan that offers coverage for residential properties that are used commercially in situations where a standard property insurance policy would not be effective. As an owner of commercial residential properties, you open yourself to a number of risks associated with a tenant-owner relationship. Insurance that protects against these unique risks must be more specially underwritten. Not only must there be coverage for the property itself, but the owner also has a responsibility to protect the people inside the unit.
A Blended Policy
Since rental properties are part business and part residential living, comprehensive insurance must blend both elements in a policy. It needs to provide coverage for losses that occur through wind or storms, theft, fire, vandalism, or malicious tenants. It needs to cover condos, multi-unit dwellings, and apartment buildings. It should be able to cover environmental-impairment liability, general liability, and property exposures.
As a property owner, you have to consider the personal property housed within your rental units. You must also consider the potential for loss of rental income, errors and omissions claims, and workers’ compensation for people working for your property. There are many risks, and one single insurance plan isn’t enough to cover them all. Habitation insurance is a start, but meeting with an insurance agent can give you direction on other policies.