Owning a home or property that you rent on a short or long-term basis is a great way to earn additional income. However, there is a lot of responsibility and costs associated with owning a rental property, which is why we want to provide you with 6 easy tips and tricks to save on rental property insurance.
- Increase your deductibles
The quickest and easiest way to save money on rental property insurance is by increasing your deductible.
The most common deductible for any building or property is $1,000. A landlord can reduce insurance premiums by 6% – 10% immediately by increasing the deductible to $2,500.
If a rental property owner increased the deductible from $1,000 to $5,000, the insurance premium would be reduced by 8% – 14%.
Choosing the right deductible is a personal decision. A large deductible may be the right move for one landlord but wrong for another. Consider picking a deductible that would “hurt” a little to come up within an emergency, but not so high that you would be unable to pay it.
- Make sure your property is updated and well maintained
Having an updated and well-maintained property is vital when looking to get a competitive insurance rate. Paying close attention to the following aspects of your property can help in its evaluation:
- Having a roof age of 20 years or less
- HVAC updates were performed within the last 15 years
- Electrical updates occurred within the last 20 years (no Fuses)
- No plumbing issues (Watch out for Kitex branded PEX)
- Well maintained exterior & interior
- Avoid using your insurance for small claims
Statistics show that rental properties have more claims when compared to homeowners properties. In order to save money on rental property insurance, it is imperative that the owner has made no previous claims, or at the least minimal claims.
While insurance carriers understand that insurance claims will occur, it is crucial to use your insurance coverage as it is intended to be used; for major incidents.
Too often, property owners use insurance more as a maintenance plan, which drives the loss experience up while simultaneously driving carrier choice down and premiums up.
Landlords should only file claims when it is worth doing so. Call one of our customer service representatives if you have any questions regarding a potential claim or if you would like specific advice.
- Decide what type of insurance you want
A critical step in evaluating rental property insurance is to decide what types of coverage you want and need. An easy way to lower your insurance premium is to remove coverage that does not fit your needs or wants. Alternatively, not having the right coverage in the first place could cost you in the long run. For example, your list of required coverage may resemble the following:
- Replacement cost-coverage on all residences and other structures
- Coverage for fire and smoke damage, lightning, ice damage, hail, wind, and water damage from burst pipes
- $1 million in landlord liability
- $5,000 for medical payments coverage
- Loss of rent coverage
- Contents protection for any furnishings you provide
All to often insurance policies are complex, and difficult to understand, so as a broker, working for you, our job is to help provide clarity, while identifying your insurance needs, to provide the right protection and peace of mind.
- Group insurance
Group insurance is a program often offered by an employer or association that allows its members and employees greater access to more competitive insurance; including enhanced coverages, policy benefits, and huge discounts on premiums.
It’s simply a way of harnessing the bulk buying power of a group and spreading the savings in the shape of reduced premiums for all the participants.
Group home and auto premiums offered through group plans are lower than the marketplace average.
It’s a win-win for all involved; the insurance company can offer its services to an exclusive audience it might not have had access to otherwise; Since the likelihood of multiple members of the group purchasing policies is high, those who sign up get exclusive access to savings.
- Shop your insurance with an insurance broker
Why should you use Insurance Brokers? Simply put, insurance brokers work for you and not the insurance company. They shop the market to find you low insurance premiums while not sacrificing your insurance coverage. Be it better coverage or lower premiums, you will save money and have the coverage you need.
If you have any questions about an existing rental property policy or would like a free quote please call us today 1-855-726-8627.