So you want to be a landlord…
Owning a home is one thing. Owning rental properties is another. Here’s what you should know…
Insurance companies view your primary home differently than a property you don’t reside in. They realize homes inhabited by tenants are far more likely to have claims because less care is taken to maintain the home. Because of this, homeowner’s policies and rental policies are written and rated differently. Many well-intentioned people buy a new home, move, and then rent out the home they just left without converting the policy. The customer now has two homeowner’s policies and one is not covered correctly! Ooops!
The proper way to insure a rental property is with a “dwelling policy” or “landlord policy”. Note, even if you don’t collect rent from the tenant, it’s still considered to be a rental property. Ultimately it comes down to who lives in the home.
If you own, or are planning on purchasing properties to rent out, make sure you notify your insurance agent.
Also, take steps to protect yourself and your rental property by following these steps:
- Know who you’re renting to! Perform background and credit checks on applicants and ask for at least two references (not including previous landlords).
- Contact their employer directly and get confirmation of their employment. Check stubs aren’t a reliable resource.
- Require the tenant to purchase renter’s insurance and ask for a copy to keep on file.
- Be a “hands on” landlord. Complete regular inspections of the property to identify any potential problems.
- If you are between tenants, help to avoid vandalism by changing locks and keeping doors and windows locked.
- Keep up maintenance on the home to help avoid damages and future claims.
- Carefully choosing tenants and being prepared and thorough will save you time and money in the long run.
Auto liability limits… do you know yours?
A surprising amount of insured drivers are unaware what limits of liability the have on their auto insurance. Many states have legal minimums which must be met but they tend to be dangerously low. This leaves many drivers exposed to unnecessary risk. For example, Indiana’s state minimum limits are 25/50/10 (or an equivalent combined single limit). This means the policy will pay up to $25,000 bodily injury per person / $50,000 bodily injury total per accident / $10,000 property damage per accident. These are limits, meaning that is the most the insurance will pay. Any bodily injury or property damages you cause that exceed these limits, you would still be responsible to pay.
Usually it doesn’t cost much more to increase your limits of liability on your auto insurance policy. At Wilkinson Insurance Agency we recommend limits of liability of at least 100/300/100. You can increase those limits to 250/500/100 for very little extra cost. In the long run, having higher limits can actually save you money! This is because when you shop for insurance, most companies look at the limits you currently have when quoting your new rate with them. Having higher limits now means you will most likely get better rates when you shop for insurance in the future.
On top of that, if you ever decide you need an umbrella policy, which gives you even higher limits above and beyond your home and auto limits, most companies recommend you have at least 250/500 to qualify.
Do you know what your limits are? Do you understand the coverage you have?
We’re always happy to answer any questions you might have on your current policies even if you’re not a current customer of ours! We feel people, customer or not, should understand the insurance they purchase so there’s no surprises when it comes to needing to use it!
Give us a call today or send us an email to discuss your coverage!
No one wants to pay more, but here’s why it’s happening…
Regardless of who your auto insurance company is, chances are you’ll see your auto insurance rates increase on your next renewal. Even if you’ve had no claims or accidents, you are still likely to pay more this time around. There are several factors companies use to calculate auto premiums. Some of these factors relate to you as an individual. For example, they consider your age, sex, driving history, how much you drive, the type of car you drive, your address, as well as information relating to your credit score, to name a few. Other factors, however, relate to your assigned risk pool- these you have no control over. This info-gram below outlines a few of the reasons for increases we’re seeing with auto insurance rates.
Many companies experiment with different types of programs designed to help them predict the future and save their customers money. A popular option is letting the insurance company monitor your driving habits and/or mileage by way of a GPS device. This device plugs into a port on your cars computer. Almost all newer cars have this ability so if you are not currently enrolled in any type of program but would like more information about it, contact your agent to find out what’s available.