You have just acquired a rental property and your regular home insurance company is having trouble insuring you or is charging you an astronomically high premium? Assurances Multi-Risques offers a few tips to help lower your insurance premium.
Let’s start by saying that there are two categories of rental properties, the first has six units or less, while the second has seven units or more. The first category is insured by personal lines insurers, while the second is insured by commercial lines insurers. This article will focus almost essentially on the first category of rental property, i.e. six-unit or less properties. A future article will deal with seven-unit plus rental property insurance.
We strongly advise that you contact an independent real estate insurance broker who will be able to help to you to make sure that your property is well covered. Note that the worst thing that you can do is to decrease your coverage in order to lower your insurance premium. Some insurers might also ask you to insure your main risk, i.e. your primary residence before agreeing to insure your rental property. An independent broker will make sure that your rental property is insured by a specialized insurer.
A few tips to decrease your insurance premium
- Do your best to maintain a good insurance record, and therefore be entitled to rebates offered to clients who maintain a blemishless record;
- Increase your deductibles;
- Regularly update your rental property insurance record as many factors can impact your premium;
- Make sure that your property is well maintained.
A few tips to obtain additional rebates
- Recent renovations (roofing, electrical supply, heating, plumbing);
- New water heaters, to decrease the risk of water damage;
- Install check valves.
We have noticed that rental property owners tend to decrease their insurance coverage in order to save on their premium. This, however, could be financially risky if a major problem occurs. Instead, we suggest that you contact an independent real estate insurance broker who will counsel you on the best insurance solutions available to you. We also suggest that you change the way you see things, and that you start to consider insurance as an investment rather than as an expense.