The short answer: a homeowners policy is written for the home you live in. A landlord policy (often called a dwelling fire policy) covers the structure of a home you rent out, your liability as an owner, and often loss of rent. It does not cover the tenant's belongings. That is their renters policy.
What changes when you rent it out
- Your stuff is not there. A homeowners policy protects the home and the belongings of the people living in it. In a rental, the belongings are your tenant's, so they belong on your tenant's renters policy, not yours.
- Your liability is as an owner. You are not there day to day, but you are still the owner if someone is hurt on the property.
- The rent is part of what you are protecting. If a covered loss makes the place unlivable, the rent can stop. A landlord policy often includes loss of rent (sometimes called fair rental value) for exactly that.
Side by side
- The building: covered under both, for the home you live in on a homeowners policy and the home you rent out on a landlord policy.
- Belongings inside: yours on a homeowners policy. On a rental, the tenant's belongings are on their renters policy. If you leave appliances, window coverings or furniture you own in the unit, ask us about landlord furnishings coverage.
- Liability: your liability as the person living there on a homeowners policy, and as the owner on a landlord policy.
- Lost rent: often included on a landlord policy. Not something a homeowners policy is built for.
How it is rented matters
A long-term tenant on a 12-month lease, a month-to-month arrangement, a short-term or vacation rental, and a home sitting vacant are four different risks. Short-term rentals (Airbnb, VRBO) are a different animal again. Vacancy matters too: some landlord forms exclude vandalism and malicious mischief by default, especially on vacant properties. Tell us exactly how the place is used, and we quote the policy that matches.
Things worth checking on a rental policy
- The name on the policy matches the deed. Your personal name, jointly with someone, an LLC or a trust: whatever the deed says. If the deed and the policy do not match, a claim can be denied.
- Replacement cost or actual cash value. This one makes a big difference at claim time. Your declarations page says which you have.
- Tenants' renters insurance. If your lease requires tenants to carry it, tell us: several carriers give a discount for this.
- Pets and tenant businesses. Tenant pets (breed matters to most carriers) and anything commercial run from the property, like a daycare or a salon, both need to be on the application.
- Water backup. Worth asking about, especially with a basement.
- An umbrella. Extra liability protection over your policies is worth a look once you own more than one rental.
Picture it
You take a job in another city and rent out your house instead of selling it. The homeowners policy stays as it was, because nobody thought to change it. A pipe bursts while the tenant is living there. Now the claim is on a policy written for a home you live in, the tenant's furniture is not yours to claim, and the months of rent you lose while repairs happen are not on the policy at all.
Now picture the other version. Before the tenant moved in, you told us the house was becoming a rental. We quoted a landlord policy with loss of rent, in the name on the deed, and the lease asks the tenant to carry renters insurance. When the pipe burst, the building claim, the rent and the tenant's belongings each had a policy that was built for them.
Switching a home over to a rental
Line up the landlord policy before the change, and never cancel the old policy before the new one is bound. If your home or auto is with us or could be, ask about bundling: it usually brings the landlord premium down too. We price it both ways, bundled and separate, so you see which total wins.
This is general education, not a guarantee of coverage. Coverages, availability and rates vary by carrier and state, and can change at any time.