Something dear to any landlord’s heart is saving money. There is an easy fix for saving money on your rental property from day one. I have a five bedroom, four bathroom single family home in Orlando that I rent out. Today, I’m using that home to show you how I saved money by switching my insurance policy. You may find what I did useful.
Homeowner’s Insurance vs. Landlord Insurance
My property insurance before renting out the property was $2,900 per year. That was the cost to insure it as an owner/occupant. It included the property insurance, the furniture in the home, the appliances, general liability, and protection against things such as theft. Anything you would expect in a general homeowner’s policy was included. As soon as you change your property insurance and become a landlord, you can save money. Be sure you talk to your insurance agent about changing to a landlord insurance policy. That language is important. A landlord policy slightly changes what’s covered in the policy, but to you as the landlord, it’s an immediate savings.
What Is Landlord Insurance?
With landlord insurance, you still have the insurance for the property; the shell, the roof, the building – all of the structure is covered. The coverage for the furniture, however, is gone. It’s the tenant’s furniture, not yours, so the tenant must insure the furniture. Coverage for any personal possessions is also gone. Whether it’s electronics, jewelry, clothes, or anything else; the renter’s policy covers that. Appliances are still part of the property and most often, appliances are covered by your landlord policy. You still get liability insurance as well, and you’re covered if there’s a break-in.
Calculating the Savings
Removing the furniture and possessions means lot less risk for your insurance company, which translates to lower costs for you. Because there’s less that can be broken or stolen, you’ll pay less in premiums. For example, my premium went down to $2,290 per year. That’s a savings of $700. So on day one of becoming a landlord, you save money by converting a normal property insurance policy to a landlord insurance policy.
This is easy money to save. If you’d like to hear more about making money from property as a landlord in Orlando, please contact us at Warner Quinlan. We’d be happy to share more information about property management in Orlando, FL.
