Insurance for Investment Property
An investment property is usually quite high on the list of personal finance strategies for making money. But remembering insurance when buying your investment property is something often overlooked by new investors and even seasoned veterans. There is so much on your plate before, during and after the buying process its an easy part to miss. Insurance for investment property (also known as landlord insurance) can cover you for a range of potential problems that can come from the residential or commercial tenants that move into your expensive new investment and protect your future return on investment.
Investment Property pitfalls
Any property investment is usually a long term investment but with long term gains can come some woes. Any property over a period of time will require preventative maintenance such as paint, guttering and electrical work. Add in tenants and the accidents that can come with them and it can become expensive in maintenance and repairs. The laws differ from country to country and it may be wise to seek legal advice but landlords are usually accountable for the upkeep on their property and this can often include damage done by the tenants. Ultimately if its your property it is in your own best interest to keep repairs and upkeep on your investment or after all your investment loses value. This is where Insurance for Investment Property comes into value.
Insurance for Investment Property
The role investment property insurance can play is similar to other forms of insurance. Landlord Insurance protects you the landlord from out of pocket expenses that you may accrue on your property. This form of insurance is different to home and contents in that it covers investment property owners compared to owner occupied homes ie The home you live in.
Investment Property Insurance 7 hot tips
- Read the fine print: When looking at your various options or policies it can pay to examine the fine print. Some policies cover more features than others and additionally some assets in your investment may need to be listed on the policy to be covered.
- Is there enough coverage: It may not need to be mentioned but a commercial property worth 7 figures versus a 3 bedroom house will have different values and should require different levels of cover from your policy. If your investment only has 75% coverage should something go wrong this leaves a serious short fall which may need to be covered from your pocket.
- Talk to a professional: Like any endeavor getting professional advice can save you more money than it costs. Many insurance brokers may cost nothing up front and have the ability to source better deals than you may find on your own.
- Shop Around: Use all sources available to you. Check your normal insurer, check internet sources even talk to other landlords about what insurers they may be able to recommend.
- Group up your policies: You may be able to negotiate a better deal from the one insurer if you are able to bring multiple policies to the negotiation.
- Ask for a better deal: Sometimes simply ask the insurance company for a better deal.If you don’t ask sometimes you will never receive a better deal and I have found in the past many times the insurance representative may hold onto a slightly better offer in order to “close the sale”
***Photo thanks to Images_of_money***