Do home insurance premiums go up if you rent out your property?
I want to rent out my home to make some extra money. If I do this, will my insurance rates go up?
Answer provided by
Answered on Mar 08, 2021
When you rent out your property, you are required to have a different type of policy. When you live in your home, you will have a primary home insurance policy; when you rent out your property, you will have a dwelling fire policy. There are a few things that can balance out the payments for a dwelling fire policy to make them similar to home insurance policies, but essentially dwelling fire policies are considered higher-risk, so the premium can sometimes be higher.
With a dwelling fire policy, you will typically go without or have a lower amount of personal property coverage. This is because you will have few or no belongings in the home to insure, unlike the tenant, and lower coverage can mean lower payments. However, since the owner does not live in the home, the insurance company may consider this situation to be higher-risk. This is because the tenant does not have what is called “pride of ownership,” which means they may not be as careful in the home as someone who has a financial interest in the property.
Did this answer help you?
Ask us a question by email and we will respond within a few days.
Have a different question?
You can meet us at our office and discuss the details of your question.
Browse by topics
What others are asking
Does home insurance cover removal of lead paint?
I'm house hunting and considering some older properties. I'm worried about dealing with lead paint with an older home, though. Will insurance pay to remove lead paint?
Mar 02, 2021
Can I finance a car with two loans?
I don't know if I'd get enough money to buy a car with a single loan. Can I get a second one?
Mar 12, 2021
Why is my car insurance so much cheaper with Liberty Mutual compared to Farmers?
It feels like Farmers keeps increasing my rates. I put in the same coverage amounts on Liberty Mutual's website and according to the quote I got, I would save $200 over a six-month policy. Why is Liberty Mutual so much cheaper?
Apr 28, 2021