Here are some insurance questions to ask before you place a tenant in your property. In most places, it isn’t a legal requirement to insure your property before renting it out. But in pretty much every case, you should. Rental insurance is a way to protect yourself financially in case something goes wrong. The additional monthly expense is worth not going bankrupt when disaster strikes.
Insurance Questions: What Kind of Coverage Do I Need?
There are lots of different types of rental property insurance, which means it’s important for you to take time to do your research and thoughtfully consider what sort of coverage you need. As you do, make sure you understand what a certain policy does and does not cover. This will help you avoid some upsetting situations when damage to your property isn’t covered based on the situation. Some of the most common policies are hazard, fire, and flood insurance. These will help you pay for repairs in case there is physical damage to your property. Liability insurance is another great policy. This will help protect you in case somebody gets hurt on your property. If you have employees, you may wish to have workers compensation insurance as well.
How Much Is It?
When choosing which insurance policies to put in place, you should consider how much it’s going to cost you. This is going to affect the profitability of your rental property. You can of course raise the rent, but that will make your property less attractive. To help you make your decisions, ask for the amount that each policy is contributing to your total cost. Then you need to estimate the likelihood of this occurring, and what it would cost you to fix the problem yourself vs with insurance. Put all this information in a table. Then use your best judgement to choose a plan that works for you.
Insurance Questions: How Can I Save?
You should always ask your insurance company for ways to save. You can often reduce the cost of hazard insurance by installing preventative devices like smoke alarms, carbon monoxide detectors, flood detectors, fire sprinklers, and security systems. You can also save by comparing quotes between different companies. By sharing the quotes that you get, you can get companies to compete for your business. This can result in either a cheaper policy, or more coverage at the same price.
Owning a rental property can be a great way to get passive income. However, it can also turn into a money hole. The difference between these two outcomes generally depends on how well you protect yourself. By properly setting up your insurance, you will be well on your way towards financial prosperity.
Looking to get more out of your property? Check out These 4 Factors Affect Your Property Value
See you at a meeting soon!
The Southwest Florida Real Estate Investment Association is the leading source of SWFL real estate investing events that provide investment education and networking in southwest Florida. We analyze the housing market and foreclosures and provide information, education, and networking events in order to build a network and knowledge base for investors and potential investors. Our members include real estate agents, brokers, investors, hedge fund managers, rehabbers, wholesalers, and more.
Our SWFL REIA General Meeting is held in Fort Myers where we provide education on hot topics in investing and an opportunity to enjoy the camaraderie of your fellow investors. You’ll get a chance to ask for advice from successful real estate professionals and even make a few deals on your latest projects.
To become a member, anyone can register as an individual, a couple, or a corporation. Being a member opens the doors for endless networking opportunities, advice from members with decades of experience, new ideas from entrepreneurs, camaraderie with those just beginning, and deals and contracts done in the meeting room. For those interested in Cape Coral rental property investment and/or Fort Myers rental property investment, SWFL REIA will be able to provide a network to help launch a successful investment career.
The SWFL REIA is known and respected as a source of current, actionable and useful information about the housing market in the area that we meet.
We meet twice a month.
One of the premier sources for real estate investing networking and education is the SWFL REIA. In the real estate world, the SWFL REIA is different in that it does not do information product sales. Their meetings are focusing on the best ways of investing in real estate by collaborating with other property investors who are sharing their experiences.
We look forward to meeting you at a meeting soon!
Click here for membership information
Get our meeting notices and market data emailed to you.