Living in an owner-occupied rental property, such as a duplex, comes with its own insurance challenges. Just like any home owner, you want to make sure that your investment is protected. A regular policy aimed at single family residences isn't sufficient, though. The following guide will walk you through the types of insurance you need.
Home owners policy
A standard home owners policy is still necessary to protect the main dwelling and to provide you with the contents coverage for your part of the residence. These policies generally cover certain forms of damage, such as fire and theft. The amount of the policy is based upon the replacement cost and value of the structure, as well as the replacement value of your belongings. There is usually some basic liability coverage, as well, although it may only cover injuries that occur to others in the part of the property that is your dwelling.
An additional policy will be written that covers the rented portion of the property. This coverage does not cover tenant-owned belongings. Instead, it protects you in the event that the tenant causes damages to the property. There may also be some included liability coverage in the event a tenant or a guest sues you over negligence on their part of the property. This insurance is provided as a separate policy by some insurers or as a rider to your existing home owner policy by others.
Umbrella policy needs vary depending on where you live. Not every type of event is covered in a standard home policy. Common examples include floods and earthquakes – for these you must buy an umbrella policy to ensure coverage. To determine which umbrella policies you need, look over the exclusions on the policy you are purchasing. Then, add on umbrella coverage for any exclusion that you feel is a risk.
Many landlords insist that tenants carry a renter's policy. This policy protects the renter from loss of property in the event of theft or property damage. It can also cover the renter's living expenses in the event that they can't remain in the property due to damages. Most renter's policies also provide coverage for any damage to the property or injuries that occur to others due to the tenant's neglect of the property, which can help you avoid having to pay to fix damages yourself.
For more help, contact a home insurance agent like those at Accredited Insurance Group Inc in your area.