Florida Landlord Insurance: Everything You Need to Know

No matter where you own property, there are always risks present. Many of those risks increase when you rent that property to someone else. Properly insuring your properties is essential for protecting your investment and keeping your landlord or property management company afloat.

Florida landlord insurance is an important part of the rental property business. Understanding what it is, what it covers, and how it works helps investors and landlords protect themselves and their properties in difficult situations.

This comprehensive guide to landlord insurance in Florida covers everything you need to know- including costs, what coverage you need, and where to get it.

Rental Costs and Landlord Insurance in the USA

Before we dive into the ins and outs of landlord insurance in Florida, let's quickly look at the costs nationwide.

Rental costs vary significantly between states and individual properties, but the average monthly rent nationwide is around $1,400. Annually, that comes to $16,800.

Comparatively, the average national cost of landlord insurance is $2,000 per year. It is well worth paying for the protection it offers.

What Is Florida Landlord Insurance?

Now, let's move on to landlord insurance. What exactly is it?

Also referred to as rental property insurance, landlord insurance is a coverage policy specifically designed for properties that have tenants living in them rather than the owners.

It generally covers all the essentials for home repairs and other liabilities, with additional coverage for the risks associated with renting a property to someone else.

In Florida- and many other states- landlord insurance is not required by law. It is, however, highly recommended- as it offers protection from significant financial loss if something significant happens. Without it, landlords or property managers are responsible to pay for the damage out-of-pocket, which can be financially crippling if disaster strikes.

Landlord Insurance VS Homeowners Insurance: What Is the Difference?

The above description may sound a lot like homeowners insurance, but there are a few important differences.

In short, you need a homeowners insurance policy if you personally reside in the property, but you need a landlord insurance policy if someone else lives there as a tenant.

Landlord insurance and homeowners insurance cross over in many ways- most notably, the coverage for any damage to the property itself. Where they differ is in the personal property and liability insurance coverage.

Homeowner insurance usually covers everything inside the property, whereas landlord insurance only covers items that belong to the policyholder. As far as liability insurance goes, a homeowners insurance policy only applies when the policyholder is responsible, but landlord insurance covers anything that happens on the rental property.

What Is Covered by Landlord Insurance in Florida?

Your specific coverage will depend on the policy you take out, but the general inclusions are similar across the board.

There are five primary categories of insurance coverage for landlords.

Dwelling

This refers to anything to do with the property itself, including damage to the structure or its important utilities. Every policy offers some sort of dwelling coverage, but the extent of it depends on the premiums you choose.

It is important to check the dwelling coverage limits for replacement costs (how much the insurance will pay to rebuild your property if it is destroyed). Although this is a worst-case scenario, it is a risk that every property owner in Florida faces.

Other Structures

If your property has any additional structures, such as a garage, garden fence, or outdoor ADU, they are usually covered as standard. Again, how much coverage you have depends on your policy.

Landlord Property Insurance

Your personal belongings are covered- a.k.a. anything in the property you paid for but supply to the tenants as part of their rental agreement.

This can include washing machines, kitchen equipment, mattresses, and furniture.

Landlord Liability Insurance

A rental property insurance policy should also cover the costs of medical bills and other expenses in case an injury is sustained on your property. As the owner, you are usually liable in these circumstances, and the insurance company should cover you for the medical costs.

Optional Coverages

The fifth category is optional extras that are not included in standard premiums. You can choose to add these if you feel you need them.

The types of extras you may need depend on where your property is located, how valuable it is, and what particular risks you face with a specific property.

Almost every rental property insurance policy includes coverage for:

• Fire insurance
• Break-ins and theft
• Injuries sustained on the property
• Water leaks
• Broken pipes
• Third-party vandalism
• Oil or appliance leaks
• Storm damage

In Florida, you can also find extended insurance premiums that cover:

• Flood Insurance
• Earthquake insurance
• Loss of rental income
• Additional accommodation if the property becomes uninhabitable due to a covered event
• Content insurance
• Malicious damage (by the tenant)
• Legal liability insurance

Make sure the policy you choose for your rental properties

What Is Not Covered by Landlord Insurance in Florida?

Landlord insurance policies do not cover everything, and it is important to understand the common exclusions so you are properly informed and can inform your tenants.

These are the most notable things that are not usually covered by a standard landlord insurance policy in Florida.

Tenants Belongings

Although the owner's personal property is covered by landlord insurance, their tenants' belongings are not.

Tenants should take out their own renters insurance policy to cover their personal belongings, amongst other things. You are allowed to require confirmation of renters insurance in the lease agreement for your rental properties.

In some circumstances, the landlord is liable for damage to renters' belongings. You can secure add-on liability coverage to cover your expenses if this happens.

Appliance Maintenance

Damage that is caused by faulty appliances or an equipment malfunction is covered, but not the repair or replacement of the appliance or equipment itself.

Broken air conditioning or heating systems, for example, are the landlord's responsibility, and will not be paid for by their insurance company. That said, some policies will cover renovations that include upgrading systems like this to be more energy-efficient and eco-friendly.

Sometimes, damage occurs because of an appliance that should have been repaired or replaced already. If there is proof that the landlord knew the appliance or machine was old or broken and did nothing about it, the insurance policy may not cover the damage caused as a result.

Properties Occupied by the Owner

Owner-occupied properties, meaning rental properties that are shared with the owner (single-room rentals, for example) are not always covered in Florida landlord insurance policies. In these cases, a homeowners insurance policy may be better.

It depends on the situation, so it is best to speak to the insurance company about the specifics so they can help you find the coverage you need.

When Does Landlord Rental Property Insurance Help?

Landlord rental insurance may not be legally required in Florida, but it is a good idea to have it anyway. All kinds of variables and risks come with owning and renting properties that can lead to significant financial consequences if you or your business has to pay for the damage out-of-pocket.

Many people ask, "Is landlord rental insurance worth the money?". Here are a few examples of potential real-life situations where landlord insurance could come in handy.

• Parts of Florida are considered high risk for hurricanes. If your property is hit by a hurricane, it can cause tens of thousands of dollars worth of damage- if not more. Without landlord insurance, rental property owners would face the prospect of essentially rebuilding from the ground up. This could be a financial impossibility at worst and a major financial loss at best. With insurance, they would have most (or all, depending on their policy limits and inclusions) of the rebuilding costs covered.
• If a fire starts on your property, the damage can be catastrophic. Dwelling fire insurance (included in rental property insurance) pays for the damage caused and helps you replace the things that were destroyed or damaged beyond repair.
• Landlord/tenant disputes are unfortunately quite common. Although they are usually resolved peacefully, some bigger issues can end up in court. Say you need to evict someone, but they are not cooperating. Hiring a lawyer and going through the official process costs money, but your landlord's insurance covers it.
• Your rental property is broken into. They steal the TV (which you own and provide as a service for your tenants). The lock on the door is also compromised, and they broke a window. Rather than having to pay for all these things yourself, you could claim the expense back through your landlord insurance.

These are just a few examples, but the list goes on. Any situation that causes damage to your rental property could leave you with expensive bills, but having rental property insurance means you don't have to cover the costs alone.

How Much Does Landlord Insurance Cost in Florida?

Landlord insurance (also known as rental property insurance) does not have a fixed price. It depends on many things, including the size, value, and location of your property and how much coverage you need.

On average, Florida landlord insurance costs around $2,400 per year, which is above the national average. Part of the reason for this is the higher-than-average median home value in Florida, which at over $407,000 sits in the top one-third of states.

Florida also has some higher weather risks than other states, including hurricanes, flooding, tornadoes, and wildfires. Overall, it is ranked fourth in the list of states most at risk of natural disasters. Because of this, the chances of making an insurance claim are higher in Florida than in a lot of other states, so insurance companies charge more for their premiums.

How Are the Costs Calculated?

The following factors are considered in the calculation of Florida landlord insurance costs.

• Property size
• How old the property is
• The condition and age of the roof
• Type of dwelling (condos, multi-family residential properties, single-family homes, apartments, etc.)
• Additional features (pools, outhouses, and trampolines, for example)
• Previous claims made
• Additional coverage options
• Coverage limits

Landlord insurance providers look at the overall value and risk of a property, with costs generally higher the more square footage it covers.

You then decide the exact coverage you want, including extras, deductibles, and limits. Some companies offer discounts on your landlord policy if you meet certain criteria, so these are taken into account as well.

Quotes may be given on a monthly or annual basis. There are usually options to pay either way.

Top Tips for Saving Money on Your Florida Landlord Insurance

As established, Florida landlord insurance is a bit more costly than some other states. There are some ways you could potentially reduce your monthly costs without compromising on the policy cover.

Get Ready for Property Inspection Ahead of Time

The majority of rental property insurance companies require a property inspection before giving a price. This plays a big role in establishing the overall cost of your policy, as the condition of the property determines (in part) how high the likelihood is that you will need to make a claim.

First, find out how in-depth an inspection the company carries out. Some only look at the structures themselves, while others look at appliances, heating and cooling systems, and more.

If you know there are potential problem areas in the property that could be called out during the inspections, it may be worth rectifying them before asking for a quote. Many policies will not cover existing issues such as mold, rot, or pest infestations.

Try to have the property in peak condition before the inspection date so there are as few things as possible to warrant a higher premium.

Consider Increasing Your Deductible

This is a complicated one, as there are pros and cons to consider. However, raising your deductible often correlates to lower rates.

A deductible is the amount of money that the landlord must cover themselves before the insurance kicks in. You can buy insurance policies with zero deductible, but they tend to be the most expensive.

Higher deductibles mean paying more out-of-pocket for damage- but they also mean lower monthly premiums in most cases. You can save money month-to-month, but you may end up paying more for small repairs that don't exceed your deductible.

Lower deductibles save you money when you make a claim since you are responsible for paying a smaller amount of money. That said, you pay more for the premium, so it sometimes balances out.

Make Storm and Wind Damage Mitigation Efforts

One of the things that most impacts the cost of Florida landlord insurance is the high risk of severe weather damage. If you can show that you have taken steps to mitigate storm damage on your property, you could qualify for a lower rate.

You can bring in a licensed storm protection surveyor to assess your property and recommend the best ways to prevent damage. If you live in a high-risk tornado or hurricane area of the state, the preventative measures may be more advanced than elsewhere.

Some examples of storm mitigation upgrades include:

• Reinforced windows
• Storm shutters
• Additional caulking around doors
• Straps on roof vents
• Hurricane-resistant roof coverings

Many companies offering landlord coverage offer discounted rates for property owners who mitigate storm damage in these ways.

Look Into Discounts Offered By Your Provider

Speaking of discounts, the total price of your landlord insurance policy can vary greatly depending on the discounts your provider offers. Most insurance companies offer deals in one way or another- some more than others- and if you qualify for more than one, it can reduce the cost by quite a bit.

Some of the possible discounts available include:

• Bundle deals when you combine it with homeowner's insurance, car insurance, or another policy
• Discounts for storm mitigation
• Reduced costs for properties with a newly-installed roof
• Lower prices for properties fewer than three years old
• Claim-free discounts

The exact offers vary from company to company, so it is worth comparing offers before you settle on one provider.

Take Steps to Reduce Your Tenant Risks

Insurance companies want as little risk as possible. The lower the risk, the lower the rate potentially is.

A risk that is unique to landlord insurance providers is the possibility of tenant issues and the liability costs that arise. One way to reduce that risk is to effectively screen tenants to find high-quality renters.

It may not directly impact your original insurance quote with every company, but it can limit the damage to your property and reduce the amount of claims you need to make. Since most insurance providers reward claims-free clients with reduced rates over time, it could reduce your monthly premiums in the long run.

The best way to effectively screen tenants are reduce your risks is to use a reliable and comprehensive property management program such as DoorLoop to handle the application process.

The Five Best Landlord Insurance Companies in Florida

The good news is many different insurance companies are providing affordable landlord insurance in Florida. We have highlighted five of the best to give you a starting point for where to look.

1: Liberty Mutual

Liberty Mutual is a great insurance company if you want to get more for your money. The range of discounts offered is excellent, and there are three types of plans designed specifically for landlords.

2: Steadily

Steadily is fairly new to the landlord insurance scene but has an impressive offering that works well for all Florida landlords- regardless of the size or type of property portfolio they have. The policies are some of the most detailed and comprehensive of any insurance company.

3: Florida Family

If you prefer a local Florida insurance company over a nationwide provider, Florida Family is a great choice. It is highly rated and considered very financially secure, with more than 25 years of success in the industry.

4: State Farm

As one of the biggest insurance providers in the US, State Farm is known for its inclusive, great-value policies and exceptional customer service. It is easy to customize a plan to fit your needs.

5: The Hartford

The Hartford is one of the most established and respected insurance companies in the US. It offers generous policies with comprehensive coverage, but it is often a little more expensive than other providers.

DoorLoop: The Must-Have Tool for Landlords and Property Managers

Landlord insurance exists to help you protect your investment properties and finances, but there are many other elements to successful property management.

That is where DoorLoop comes in. As well as providing helpful information to make life easier for landlords, DoorLoop goes a few steps further.

What Is DoorLoop?

In short, DoorLoop is an all-in-one comprehensive property management system that covers everything landlords need to make running their property business easier, more efficient, and more convenient.

No matter how big or small your property portfolio is- residential or commercial- DoorLoop offers a proactive and intelligent way to manage daily tasks, tenant interactions, accounting, and more.

What Does DoorLoop Do for Landlords and Property Owners?

DoorLoop brings together all the different elements of managing properties to offer a sophisticated and streamlined service for landlords.

Some of the ways it can help Florida landlords and property managers include:

• Online maintenance request management
• Tenant portals
• Marketing and advertising on major listing sites
• Rent collection and automated reminders
• Tenant screening and application processing
• Customized application website for tenants
• Advanced accounting software
• Expense and income tracking
• Portfolio management
• Lease management

How to Get Started

You can request a free demo with DoorLoop today to get the full experience of what the software can do for you and your business. Learn more now about how to get more out of the landlord experience with DoorLoop.

Summary

Anyone who manages rental property in Florida should seriously consider landlord insurance as essential. Plenty of companies offer rental property landlord insurance, so spend some time comparing a few to find your best fit.

To make everything else about being a landlord a whole lot easier and more efficient, check out what DoorLoop has to offer!