Best Landlord Insurance Based on In-Depth Reviews
- 200+Hours of research
- 70+Sources used
- 11Companies vetted
- 4Features reviewed
- 7Top
Picks
- Homeowners insurance policies don’t cover landlords
- Premiums are typically higher than for homeowners insurance
- It can protect against liability lawsuits and loss of rental income
- Landlords should encourage tenants to get renters insurance
How We Found the Best Landlord Insurance
Our Top Picks: Landlord Insurance Reviews
Landlord insurance is all about customizing policies to cover a landlord’s specific vulnerabilities and needs. Ultimately, the factors that best fit an individual are entirely dependent on their unique situation.
Experts recommend that consumers both shop around for landlord insurance and consult with an agent, broker, or insurance representative that can guide them into determining what kind of coverage best suits them. Indeed, most insurance companies don’t even offer an online quoting system but instead direct customers to their pool of agents given how unique each landlord’s situation can be.
Overall, basic coverage should include building and property protection as well as liability. Alongside this—sometimes sold as an extra on policies—landlords should consider loss of rental income coverage. Consumers should also identify what kind of extra protection they need, be it for electronic equipment, a home office, or worker’s compensation, or against inflation, vandalism, and natural disasters. In the reviews ahead, we detail what kind of extras, benefits, and even discounts insurers highlight on their websites.
One category that tends to feature frequently in insurance reviews is “financial strength,” which we also list above as one of the vetting factors we used. All of the companies we feature have very high ratings from multiple agencies, with none rated lower than A-.
In order to avoid becoming monotonous, we chose not to include individual ratings for each company. Consumers shopping around for landlord insurance beyond the companies listed here should consider the insurers’ financial stability.
Liberty Mutual review
Best For Inflation Coverage
Inflation refers to a decrease in the “purchasing power” of currency, which affects all areas of the economy and business, including property value. The amount of building coverage needed depends on the value of repairing the property if it gets damaged from one of the named perils in the policy. That amount needs to progressively increase as inflation increases, otherwise the purchasing power of the insurance coverage will cover less than originally intended. Liberty Mutual’s inflation coverage add-on is a great way of protecting a property against economic changes.
Liberty Mutual’s coverage is standard and uncomplicated and can cover up to 16 units in 1 to 4 unit properties. In other words, it can cover up to 16 separate units in 16 properties, or a maximum of 4 properties with 4 units each. They also indicate that customers can add their LLC as a “named insured.”
Screenshot LibertyMutual.com, October 2019
Liberty Mutual is available nationwide, but consumers should speak directly with a representative to learn whether any specific restrictions apply to their state. It’s unclear what other extras, add-ons, and discounts are available without going through the quote process—which cannot be completed online—or without speaking to an agent.
Allstate review
Best For Online Resources
Allstate offers standard landlords insurance, covering the basic areas of property/building, liability, and loss of rental income. As with most insurance companies, it’s not possible to obtain a quote for landlord insurance through the online system. Instead, landlords need to use the find an agent tool.
However, Allstate’s best feature is its copious online resources, from detailed brochures that explain key aspects of policy documents, to a common claims tool that lets landlords see what types of claims are most common in their area.
Screenshot Allstate.com, November 2019
Allstate does not appear to offer replacement cost value coverage. Instead, as their policy brochure explains, landlords have two options: actual cash value or building structure reimbursement, the latter which is only available to select properties who meet age and condition requirements. That means that some landlords might not be eligible to have replacement cost coverage.
Landlords can purchase additional coverage for vandalism and burglary, which is typically not covered in their standard policies. They also have the option to purchase separate umbrella coverage and flood protection.
As mentioned above, Allstate’s online resources and commitment to educating consumers are laudable. For example, their policy guide explains how to navigate and understand a policy document, even going as far as explaining that the policy itself does not constitute a bill.
State Farm review
Best For Unique Coverage Options
Called, alternatively, Apartment Owners Insurance, State Farm Apartment Policy, and Apartment Insurance Policy, State Farm’s landlord insurance offers a wider range of coverage options and add-ons than most insurers. In addition to the standard coverage, State Farm offers unique protections that cover the losses from needing to move tenants back into the unit, to mechanical failures in the heating or cooling systems.
Screenshot StateFarm.com, November 2019
State Farm also offers unique add-ons, though it’s difficult to determine whether they offer other common extras or discounts. And also, it should be noted that the identity restoration coverage is not available in the state of Rhode Island.
Screenshot StateFarm.com, November 2019
Farmers review
Best For Tenant Screening Help
Farmers offers a free tenant screening service through TransUnion called SmartMove. The service allows landlords to request necessary documentation, including credit scores and background checks, with ease. This, in turn, can make it easier for landlords to show that they are invested in reducing tenant risk, which can reduce premiums.
In addition, Farmers’ insurance is highly customizable, with no area being strictly part of their “standard” coverage. Available policies include comprehensive property coverage (likely an “all-perils” policy), named-perils coverage, and liability coverage. Other common coverages are also listed as optional:
Screenshot Farmers.com, November 2019
Farmer’s webpage doesn’t indicate what kind of add-ons or discounts are available for landlords. However, the discounts page lists some discounts for homeowners that could potentially apply to landlords. It’s worth asking an agent if they are applicable.
Screenshot Farmers.com, November 2019
Hippo review
Best For Add-On Coverage
As one of the fastest-growing Insurtech companies, Hippo has established itself as a solid competitor in the online insurance market. Its usage of algorithms to process and pay out claims enables the company to offer much lower premium rates for landlord insurance than most other companies.
Our favorite feature is that Hippo offers “enhanced coverage” add-ons for a wide range of scenarios, from modern necessities like electronics and home office coverage to natural disasters, which many insurers don’t do.
Hippo’s standard coverage includes building and content damage, liability, and loss of rental income. Quotes offer three preliminary ranges, “the essentials,” “our best value,” and “expanded protection.” Consumers can edit and change the coverage amounts as needed, understanding that this will affect their premiums too.
Screenshot Hippo.com, October 2019
There are a few cons to Hippo’s service, however. They limit the number of covered properties to 10 and their landlord insurance is not available nationwide. Currently, they offer insurance in Alabama, Arizona, California, Colorado, Georgia, Illinois, Indiana, Maryland, Minnesota, Mississippi, Missouri, Nevada, New Mexico, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Utah, and Wisconsin.
In addition, although Hippo is an online insurtech startup, they do not have an online live or AI chat as other insurers do. Customers can contact different departments by email, phone, of the Customer Portal, though this last one is only available for existing customers. Similarly, claims can be filed through the online portal, by email or phone.
Country Financial review
Best for Comprehensive Coverage
Country Financial offers one of the most comprehensive coverages we have seen. Similar to Hippo, they break down their options into a basic package and a more comprehensive one to suit their customers’ needs. The company is also highly rated by A.M. Best. and they obtained the second-highest score in J.D. Power’s 2019 Property Claims Satisfaction Study. Unfortunately, Country Financial is only available in 19 states as of the time of this review.
Country Financial’s coverage packages—basic and premier—are essentially “named perils” and “all-perils” policies respectively. Consumers should note that all-perils insurance has named exclusions, and should consider if they need additional coverage for those excluded perils. Country Financial also lets customers choose whether to have actual cash value or replacement cost coverage.
Screenshot CountryFinancial.com, November 2019
Country Financial’s add-on options are also exceptional, particularly as they can provide landlords with needed protection against various natural disasters. As they indicate on their website, some of these additional protections—such as flood coverage—are available through external insurers via Country Financial.
Screenshot, CountryFinancial.com, November 2019
Overall, Country Financial offers some of the best online resources in the insurance business. Not only is their website user-friendly and scannable, they make it easy for consumers to know what their insurance options are. The tools and resources section not only contains articles on insurance, but they also provide educational resources for children, teens, parents, and teachers, as well as a variety of budgeting calculators.
Finally, customers have the option to file claims through their online account or by phone, and they can be monitored through the mobile app.
Travelers review
Best For Extra Medical Coverage
Travelers landlord insurance covers the basic areas of protection landlords need, while also offering extras in the form of medical payments add-ons and umbrella coverage. These are particularly useful to landlords with injury-risky properties.
Landlords should note that Travelers policies only cover up to 4 units in a property, meaning that additional coverage of multiple separate properties would be needed either through a separate policy or insurer. It’s worth consulting directly with one of their agents if more units need to be covered.
Screenshot Travelers.com, October 2019
In addition to medical payments to others and umbrella coverage, customers can also request extra coverage for jewelry and other valuable items. While this is specifically targeted at homeowners and renters who are more likely to need to insure expensive items in their homes, it’s worth consulting a Travelers agent if special property coverage needs to be added. Consumers should also be aware that standard coverage does not include earthquake and flood protection unless extra coverage is purchased for it.
Honorable Mentions
For landlords looking for bundling options, we also recommend The Hartford’s and American Family’s landlord insurance. The Hartford lets customers add landlord insurance to their existing homeowner insurance.
Meanwhile, American Family’s landlord insurance can be combined with a commercial liability umbrella policy, business owner policy, business auto insurance, and life insurance policy. Unfortunately, American Family is only available in 19 states.
Further Insight into Our Methodology
When it comes to landlord insurance, there’s no “one size fits all.” All of our experts echo the same piece of advice: coverage depends on the property and the risks surrounding it.
We talked to Lynne McChristian of the Insurance Information Institute, who explained that choosing the right insurance policy is tied to understanding vulnerability. “It’s important for landlords to understand that what they’re buying is financial protection. That basic policy alone might not be the right level of protection. You want to understand what can go wrong with this property and how you can protect your money, because if you don’t have insurance it comes out of your own pocket.”
We focused our reviews on showing a variety of coverage options from different companies and how they might benefit landlords in a variety of situations.
Coverage
According to Lynne McChristian, Communications Consultant at the Insurance Information Institute, “Landlord insurance provides coverage for financial loss over three important areas: 1) it covers any property damage that is listed as a covered peril, 2) it provides very important liability in the event that somebody gets injured on the property, and 3) it covers loss of income – so if there’s damage to the property that makes it impossible for someone to live in it, it provides loss of income you’d be getting off the rent.”
These three areas—property damage, liability, and loss of income—became our benchmark when looking at insurance companies. In addition, we searched companies' websites for information on their average quote prices, the number of units and properties a landlord can insure in one policy, and whether the company is available nationwide, regionally, or only online. It was not possible to obtain quote prices for most companies because these are only available by contacting an agent.
Extras
No good insurance policy is complete without the specific add-ons needed to ensure that the property is protected against risks specific to that property. It’s particularly important that consumers be able to purchase additional protection for natural disasters like floods and earthquakes—which are not usually included in the standard policy—as well as for burglary, vandalism, or workers’ compensation, if it applies to their property.
Some insurance companies and agents can get landlords extra protection for floods, for example, through the National Flood Insurance Program (NFIP), integrated into the insurance policy. Others, however, do not provide any coverage for natural disasters, and landlords need to purchase a separate policy directly.
Because protection against disasters like floods is very specific to the region the landlord’s property is in, we did not use these extras as a vetting tool. Some insurers can provide excellent protection against other perils that are relevant to the landlord’s needs. Nonetheless, in our reviews, we make sure to point out which insurers promote which add-ons, which can make comparison shopping easier on landlords.
Customer Support
One of the things that became evident when we began our research into landlord insurance is that even the insurance companies that have a wide range of resources and educational materials on homeowners, renters, and auto insurance tend to have a very limited amount of resources on landlord insurance.
As we point out in our reviews, companies frequently only have one main page with basic information, which typically does not include all of the available add-ons and discounts and at most one or two articles on the subject. On one hand, this makes it harder for landlords—especially casual and accidental landlords—to arm themselves with the necessary tools with which to make decisions that fit their coverage needs.
On the other hand, landlords can expect insurance agents to be available to guide them through the best coverage policies tailored to their properties. In other words, they are not left alone to navigate the information solely on their own. We asked New York-based author and attorney Ron Leshnower about this issue, and he explained that “Agents and brokers aren’t overselling insurance or pretending that you need coverage if you don’t. Speaking to an agent also gives a personal touch that can give landlords peace of mind.”
Financial Strength
Whether it’s determined through rating agencies, looking at the number of direct premiums written, or the reinsurers and underwriters, it’s important to always consider if an insurer has the financial stability and strength to cover their policies.
The National Association of Insurance Commissioners published a breakdown of 2019’s top 25 property and casualty insurance providers based on premiums written and how much of the market share they own. This can give consumers an idea of how financially stable a company is. Companies that aren’t featured in the top 25, can still be rated by a credit rating agency, such as A.M. Best, Moody’s, Standard and Poor’s, or Fitch, which issue ratings based on a company’s ability to pay out claims and meet its financial commitments.
Additionally, other smaller insurance companies are underwritten and/or reinsured by bigger insurance companies or financial institutions, which further increases their financial strength and ability to meet their commitments, and reduces risk to the consumer.
Consumers should always consider whether the insurer they are using has the financial stability to pay out large claims.
Helpful Information About Landlord Insurance
Landlord Insurance 101
Property insurance is a protection against financial property loss. It offers protection against “named perils”—types of situations that are covered against damage.
What is landlord insurance?
Landlord insurance is, as the name suggests, insurance protection for landlords. It can often go by other names, including “dwelling property,” “rental dwelling,” “rental property.” The policy document can fall into one of three categories: DP1, DP2, DP3, each offering increasingly more comprehensive coverage.
There are three main types of coverage that landlords should expect in their policies:
Building and property coverage: This coverage typically includes protection against named perils like fire, windstorm, smoke, snow, and water damage.
Liability: This coverage protects landlords against a lawsuit from anyone claiming to have gotten injured on the landlord’s property. As Lynne McChristian, from iii.org, told us, “It’s important to remember that we live in a litigious society. Landlords need to seek protection for that; it’s the cost of doing business.”
Janet Portman from Nolo.com also highlighted the importance of liability coverage by painting us the following picture: “Let’s say that you’re a fairly reasonable, secure landlord. You make sure everything is up to code and you screen your tenants. And then a renter, one of their guests, a delivery person, or even the UPS guy, slips on the front stairs. And then they call you saying “I was hurt at your property because this wasn’t properly maintained. Who is your insurance company? I want to file a claim.”
Liability coverage protects landlords from having to pay for lawsuits out of pocket.
Loss of Rental Income: If the property becomes uninhabitable due to damage from one of the named perils, the landlord will not be able to rent it out, and they will, therefore, lose the income expected from the rental property. This coverage is often an extra add-on, but it’s highly recommended that landlords include it in their policy package. Note, however, that it does not cover loss of rental income if the tenant defaults on their rent. There are separate “rent rescue” or “rent guarantee” insurance policies that can be purchased with external insurers.
How is it different from homeowners insurance?
This is a common question asked by homeowners who are renting a room or section of their home out to a tenant, or who have inherited a property that previously had homeowners insurance. The question is usually followed up by “why is landlord insurance more expensive than homeowners?”
Lynne McChristian, of the Insurance Information Institute, explained that: “Homeowners insurance is for the resident. If you rent out a room in your home and you live in your home as your primary residence, then that might make a difference and homeowners insurance might cover that. But it might not be the correct level of protection.” She then added that insurers see renters as a higher risk. “When you own property that you don’t live in, it becomes a commercial business, and it requires different coverage. It’s more expensive than homeowners because you don’t have someone who has the same level of vested interest in the property that a homeowner would have.”
When we interviewed Janet Portman, residential and commercial landlord/tenant law and former public defender, she echoed McChristian’s explanation and further warned that: “Trying to cover your renter with a homeowners insurance policy is risky because, if there’s a loss and you file a claim, the company will investigate it. When they find out you had a tenant, you will not be covered, and all the money you paid in premiums will be for nothing.”
The bottom line is: landlords are only covered by homeowners insurance if they’re living in the same property as the tenant, and even then, it’s important to confirm that the insurer will not void the policy for such an arrangement.
Understanding Risk and Its Effect on Premiums
The higher the risk, the higher the premiums. Because insurance is about managing risk, the more risks that have to be accounted for, the riskier it is for the insurer, therefore the higher the premiums become for the customer.
 Premiums go up and down depending on what brings up risk and what brings it down. |
|
| RAISES RISK = HIGHER PREMIUMS | LOWERS RISK = LOWER PREMIUMS |
|---|---|
 Larger size of the property and number of rental units being insured |
 Smaller size of the property and number of rental units being insured |
 Older age and poorer condition of the property |
 Newer age and better condition of the property |
 Crime or natural disaster-heavy geographic location of the property |
 Lack of crime or natural disaster-heavy geographic location of the property |
 The presence of a swimming pool, hot tub or another high-risk feature |
 No swimming pool, hot tub or another high-risk features |
 The type of guest staying in the rental property (short visitor) |
 The type of guest staying in the rental property (long-term visitor) |
 Lack of security features installed on the premises, like smart alarms, locks and cameras |
 Security features installed on the premises, like smart alarms, locks and cameras |
Janet Portman gave us the following example of why rental properties are considered riskier:
“Homeowners insurance is less risky than landlord insurance because, from the company’s perspective, they have more assurances that risks will be minimized. Homeowners are more likely to notice a problem and be invested in fixing it. This can be proven through the homeowner’s claims history. However, risk is multiplied when you have tenants. The insurance company doesn’t know anything about the renter’s history, so they are taking on a higher risk.”
Thus, the premiums must also be higher.
Why you can’t afford not to have landlord insurance
“Are you willing to gamble on losing everything? It’s foolish not to have insurance.” - Janet Portman, executive editor at Nolo.com
 Breakdown of Common Landlord Claim Costs |
|
| TYPE OF DAMAGE | AVERAGE CLAIM COSTS |
|---|---|
 WATER DAMAGE |
$8,150 |
 THEFT/BURGLARY |
$2,673 |
 WIND |
$4,339 |
 FIRE |
$74,963 |
 PHYSICAL DAMAGE |
$4,190 |
 LIABILITY |
$14,722 |
 HAIL |
$5,774 |
 MYSTERIOUS DISAPPEARANCE |
$7,506 |
 FREEZING WATER |
$3,762 |
What to Watch Out for When Buying Landlord Insurance
Doing it alone versus using a broker
“Having a conversation with a trusted insurance representative is important because it helps you understand your vulnerabilities.” - Lynne McChristian, from the Insurance Information Institute
This advice was also echoed by Janet Portman, the executive editor at Nolo.com. While many casual and accidental landlords who are managing a property they inherited or originally bought for another purpose might want to save a few dollars by tackling landlord insurance on their own, it’s always a good idea to consult with an expert. “Find an independent broker to advise you. They don’t have ties to a specific company, so they won’t have a vested interest in selling you a policy from only that company,” Portman advised.
A broker can further help landlords identify the amount of coverage they need, the risks pertinent to their area, and which exclusions would be detrimental to them.
Consider getting replacement value instead of actual cash
One of the things that can lower premiums is having an “actual cash value” (ACV) policy. ACV takes depreciation into account when determining how much the insured should receive for damaged property. That means that although something might have cost $1,000 originally, the policyholder will only receive an equivalent of what the item is worth now, which can be a significantly smaller amount.
That’s problematic for landlords who need to replace damaged property to the same original standard of quality or even to the current, more modern standard of quality. In order to ensure that damaged property can be successfully replaced without incurring unnecessary costs, it’s better to choose “replacement cost” coverage. The premiums will be higher, but so will the peace of mind.
Remember the add-ons
When it comes to add-ons, endorsements, floaters, and riders, there’s no one-size-fits-all policy. Landlords typically need extra coverage for loss of rental income, electronic equipment, water-back up, and vandalism, among others. Of course, the type of add-ons a landlord needs depends entirely on their particular situation, the age and size of the property, the geographic location, the number of units, and the risks to which the property is vulnerable.
A particular add-on that landlords might consider looking into is an umbrella coverage. Umbrella coverage protects landlords from bigger liability claims after the standard insurance meets its maximum payoff.
Natural disaster coverage is usually extra or separate policies
The effects of natural disasters, such as flooding or water seepage as a result of a storm or hurricane, are seldom covered in standard landlord insurance. It’s important when comparison shopping to identify whether a company offers flood coverage through another insurer like the National Flood Insurance Program, or whether they offer no such connection, forcing the landlord to purchase their own flood insurance separately.
Bottomline: landlords should identify the vulnerabilities of their property based on their geographic location. These can also include areas prone to earthquakes and forest fires, which are sometimes not covered under some policies.
Don’t forget the exclusions
Exclusions are something to watch out for particularly with DP-3 policies. These comprehensive policies are for “all perils,” but conversely, they have exclusions—specific perils that are not covered by the policy. These often include riots or certain types of vandalism, water damage from floods, lead-based paint claims, mold damage, “acts of god,” and even war or nuclear events.
Experts advise that landlords consult with their insurance agent to know whether they actually do need coverage, and therefore additional or external insurance, for perils in the exclusions.
Be Aware of What Can Void a Policy
A common mistake made by many policyholders is thinking that once they have purchased a policy, they are guaranteed coverage. However, there are many things that can void a policy if the insurance company considers the landlord to be in breach of the contract.
Common causes can include poor maintenance of the property, failing to report major changes to the insurer (such as making renovations or additions to the property), and filing too many claims. Practices that help reduce policy cancellations or rejected claims include keeping up-to-date documentation on the property, keeping the insurer aware of any relevant events that happen such as damages, accidents, break-ins, and filing a police report as soon as an incident requiring it happens.
Watching out for your tenants
While landlord insurance protects the landlord’s belongings—the physical building and any appliances and furniture within it—it does not protect the tenant’s belongings. This is why experts unanimously recommend that landlords encourage their tenants to get renters insurance as well. Renters insurance includes coverage for personal belongings, liability, additional living expenses, and medical payments to others. If a guest is injured in a rental property covered by renters insurance, landlords can rest easy knowing that there are extra levels of protection.
In addition, it’s also recommended that landlords be aware of the rental assistance program offered by the Department of Housing and Urban Development (HUD) designed to help low-income renters.
FAQs about Landlord Insurance
Is landlord insurance expensive?
In comparison to homeowners or renters insurance, landlord insurance is usually about 20% more expensive. However, the average cost of landlord insurance—$1,300 per year—pales in comparison to the costs of repairing damages caused by fire, water backup, wind, or snow; the costs of a liability lawsuit if a tenant is injured; or the monetary loss of months of rental income if the property becomes unlivable.
The bottomline is that landlord insurance is more costly because the risks are inherently higher.
Is landlord insurance required by law?
No, it’s not required by law. Nonetheless, it’s a protection against likely and probable losses.
How much landlord insurance do I need?
The amount of insurance needed will depend on the amount of property—age and size of the building, location, number of units—and the likely risks in and around it such as flooding, earthquakes, snow and wind damage, vandalism, crime, etc. Landlords need to evaluate their property, preferably with the help of an insurance agent or broker, in order to determine how much coverage they need.
How does landlord insurance affect my mortgage?
Ron Leshnower, a New York-based author and attorney, explained that most mortgage lenders require landlords to purchase an insurance policy on the property in order to take out the loan. The reason for this is that the lender is taking a risk on the borrower (the landlord), and insurance protects the landlord’s ability to remain financially solvent and continue paying back the mortgage.
In this sense, having landlord insurance protects a landlord’s mortgage investment by making sure that, in the event of a catastrophe, their property is protected and their pocketbook won’t be severely hit (preventing them from making mortgage payments).