When Should a Homeowners Policy Become a Landlord Policy?

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This post was written by Eric Skarnes for Simply Residential Property Management Magazine.

Whether you are currently renting out your home or considering the option, it’s important to know about the differences between a typical “Homeowner’s” policy versus a typical “landlord” insurance policy. It’s common for property owners to make the mistake of keeping their homeowner’s policy even after they have moved out and start using the property as a rental. Should you ever need to file a claim, it’s important to make sure that you have the proper coverage. Unfortunately, people often find out after it is too late, that they should have changed their coverage to a “landlord” policy.

Most homeowner policies state that your home must be “owner-occupied,” or the insurance carrier has the right to deny you any potential claim. You and your family must be living there. For example, if your home incurs fire damage and it is discovered that the fire was caused by a tenant or renter, it gives them an easy-out to deny your claim. Leaving you responsible for the entire cost of repairs!  This can also apply to the “liability” portion of your policy.  If your tenant forgets to shovel the sidewalk and someone slips… falls and gets hurt, or should their dog bite the neighbor, your insurance company will be quick to deny the claim. Once again, you will be left holding the bill. Insurance companies are not in the business of paying out money when they don’t have to.

Another difference between homeowners and landlord insurance is the need for “Loss of Rent/Income” coverage.  This coverage is included in a landlord policy and pays you rental income should your tenant have to move out while the house is under repair due to a claim. Typically during this time period, the tenant will stop payment until the property is restored and they are able to move back in.  For example, if a water pipe breaks or a kitchen fire occurs, should your tenant have to move out while the damage is repaired, you are paid the rental income by your insurance company.

And finally, just because your current insurance company had a good rate for your homeowner’s policy, it doesn’t mean that they will have a good rate for your landlord policy.  Every company has their “niche” and that niche often changes over time.  Now that your property has become a source of income and a positive cash flow is the goal we recommend reevaluating your insurance on an annual basis. So, do yourself a favor and shop several different companies to make sure you are getting the best coverage and price.

Eric Skarnes is the president of the Twin Cities-based Insurance Warehouse. They offer auto, commercial, life, home, business, and umbrella insurance. He can be reached at (612) 354-2040 or via email at eric@skarnesagency.com.

4 Things to Consider When Choosing a Property Management Company


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You’ve crunched numbers. You’ve considered all the possible outcomes and challenges. And now you’re comfortable moving forward hiring a property management company to manage your rental property. Congratulations. While you’ve made some substantial progress, your journey to rent your property still has some road left to travel.

Entrusting your investment property to a property management company is easy, though admittedly emotional. But deciding which property management company to hire is the real important decision. These should be the most important factors you consider when comparing property management companies:


One of the more important issues you’re interested in is the cost. There are fees for management, vacancy, set-up, maintenance, eviction, advertising, unpaid invoices and more. Renting a property is meant to bring you additional income, right? The less a property management company charges, the better.  But while price is obviously a major factor, don’t get too caught up in only the total cost of these fees. Consider how that cost is spread out over time. Some property management companies load up a management contract with upfront costs. Ask yourself, if they are paid up front, what’s their incentive to perform at a high level throughout the duration the agreement? Other property management companies forgo those heavy upfront costs in favor of building long-term relationships with you and proving themselves over time.

Personal Attention

You’ve heard the saying “Bigger isn’t always better.” That applies when considering property management companies. If your research shows that all factors are equal between two property management companies other than sheer size, you may receive more personalized attention from that small partner. You’ll be viewed less as a number and more as a true partner. In the end, we all want a property management company we can trust that provides timely and courteous communication throughout the relationship.


The property management company is responsible for maintaining  and hopefully increasing the value of your investment property during their time as your partner. That can be done by properly addressing existing issues and being proactive with preventative maintenance.  Here are a few questions to ask property management companies about their maintenance approach:

How are tenant maintenance requests tracked and acted upon?
What’s the process for after hours maintenance?
What can you tell me about your maintenance technicians?
Is maintenance coverage 24/7 and 365 days a year?
What’s the process for entering my property?

The Tenant

You already know how important a property management company is. The tenant chosen to live in your property is also important. The services of the property management partner should include finding, screening and securing tenants. You’ll want to know where your rental listing will be advertised, how screenings will be conducted on applicants and what steps will be taken to secure tenants. It’s important to feel comfortable with the property management company’s approach to tenants and their capability to find a great fit.

Learn how Simply Residential Property Management is simply different than other property management companies. Request a free rental analysis today!