In order to determine if you need landlord insurance, it is important to understand the purpose of a landlord insurance policy in Illinois. This review discusses the standard coverage in a landlord insurance policy, who needs one and how much a policy generally costs. It will also outline some of the factors that may affect the cost of a policy.
What Is A Landlord Insurance Policy In Illinois?
A landlord insurance policy in Illinois is an insurance policy for property owners who rent their property to a tenant; it is not the primary residence of the property owner. The property owner’s personal homeowners insurance policy typically will not cover the cost of damages and liability claims on a property that is rented to tenants.
A landlord insurance policy protects the homeowner for damage and liability related to the rental property. The two primary coverages that are included in this policy are landlord liability insurance and dwelling insurance. Other structures and personal property (which is used as part of the rental) are typically covered in a standard Illinois landlord insurance policy as well.
How Much Does A Landlord Insurance Policy In Illinois Cost?
The cost of a landlord insurance policy varies depending upon the specifics of your policy. On average, the premiums may add up to approximately $2,000 per year. The average landlord insurance policy typically provides a $200,000 limit for dwelling coverage. Each policy, and its cost, is customized and unique making it important to discuss your policy needs with a landlord insurance agent.
Factors That May Affect The Cost of Your Landlord Insurance Policy
The cost of a landlord insurance policy is determined based upon the specific coverages that are included in your policy, the type of property (or properties) to be covered, the property location within Illinois and the amount of chosen policy limits. Any previous policy history may affect your rate as well.
The Property Type
The age and type of the property will also be considered when calculating landlord insurance costs. The more vulnerable the property is to damage, the more likely it is to have an increase in cost. Whether the property is a single-family or a multi-family property (i.e. apartment or condominium) will also be considered.
The Location In Illinois
Homes in Illinois are generally more vulnerable to damage from severe weather than some other states; therefore, comparatively increasing the cost. Certain areas of Illinois may be more vulnerable to heavy wind and thunderstorms, which could affect the cost of a landlord insurance policy.
The specific neighborhood in which the property is located may also impact insurance rates. If the property is located in a community with a low crime rate, then you may benefit from lower landlord insurance costs.
The Extent Of Coverage
A standard landlord insurance policy includes dwelling coverage, other structures, liability claims and your personal property which is used as part of the rental. If you add other coverages to the policy, such as loss of income or construction insurance, the cost of the policy will increase.
An experienced insurance provider will be able to customize your insurance policy according to your specific needs. While some landlords may only require a basic plan, others may need additional coverages to adequately mitigate their overall financial risk.
The Amount Of Your Policy Limits
The policy limits will also impact your premium costs each month. A standard policy usually includes limits for dwelling insurance that are up to, or slightly higher than, the value of your home; the other structures limits are usually around 10% of the dwelling coverage limit. If you choose a higher coverage limit, you should expect to see that reflected in the policy cost. The deductible amount you select can impact your premium as well.
What Is Included In A Landlord Insurance Policy?
A standard landlord insurance policy includes dwelling, other structures, liability and personal property coverage. This includes many of the claims a landlord may need to file. Dwelling coverage, in particular, covers the dwelling for damage that is caused by vandalism, fire and severe storms, among other covered perils. However, landlord insurance does not cover the tenant’s personal property, which should be covered by the renter’s insurance policy purchased by the tenant.
Pro Insurance Group Offers Landlord Insurance Policies For Illinois Property Owners And Managers
Pro Insurance Group can help you customize your landlord insurance policy to meet your precise policy needs and goals. If you have questions, concerns or are ready to start your Illinois landlord insurance policy with Pro Insurance Group, call our office or send us a message today.