insurance policy for rental home?

[wodehouse]

Question. My mom is temporarily renting her home for several months (to the home buyers; there is a signed contract). We just got a quote of over $1100 for annual premium for insurance. This seems a bit excessive to me; her homeowners insurance was maybe $400 a year. The value of the structure is maybe $60,000. This is small town, rural midwest. Of course, she's out of state now from that house, which seemed to increase the premium.

Those of you with rental properties, are the rates really this high?

Thanks!

[Gardening Grandma]

I'd shop around. Our rental house is in a major city and the premium is $444/yr. The house is assessed at $150K (house only, not including land)

[zibazinski]

She is getting ROYALLY ripped off. My rental insurance even for my renter occupied homes is so much less than insurance on my home.

[zibazinski]

Check Assurant or try whoever she has auto with.

[wodehouse]

Mom has a lot of insurance through Hartford Insurance, which came via AARP. Hartford dumped her homeowners policy, they say they don't write policies for rented houses. That's not what they told her over the phone 3 months ago, but that's what the letter says. She gave up her car (and the Hartford auto insurance) when she moved to the other state. So we just called a local agent in the town where her house is.

I agree, this new policy sounds like a royal ripoff.

Thanks for the info.

[hcj]

Our insurance on our primary residence is $600/yr and $1,000/yr on our rental. I don't think assessed value comes into play, rather it's based more on the rebuild cost. The rental has more square footage, but no garage. I do know that they said it's higher for rental property and one of the things it provides is loss of rents, but then I think our primary provides loss of use.

We have a multi policy discount on our primary homeowner's, but the rental is with a different insurer. Perhaps a combination of it being a rental and not qualifying for the multi policy is causing the differential. Still, she should shop around.

[zibazinski]

What states are you in? Even Florida which is notorious for ripping off homeowners is reasonable for rental insurance policies.

[wodehouse]

Property is in Indiana. Mom's new residence is indeed in Florida.

[zibazinski]

Homeowners insurance in Florida is unreasonable but renter's is very reasonable. I cannot imagine why Indiana would be so high. Tell them your renter's will have insurance as well, maybe that will help. I'd shop because my rentals are on the west coast and I don't pay more than $250 per year and I have million dollar umbrellas as well. My homes are insured for 150k which is probably overinsured.

[resolution]

That seems really odd to me. My homeowners was $800 a year and when I moved out and converted the house to a rental it dropped to $500. It was cheaper because although I increased the liability quite a bit, it stopped covering the contents of the home and only covered the structure and liability.

[zibazinski]

That's how it SHOULD work.

[jarhead1976]

She should have just kept her original homeowners till they closed!

[DVM gone riding]

unless there is a large mortgage you can tell them what you want the house insured for!! And don't include any land value

[Nazgul Girl]

Our rental house has a surprisingly high insurance premium for the policy we have on it. It may be just in our state, but many wellknown insurance companies wouldn't even write a policy on the rental, even though it's in an excellent neighborhood. We had to call six insurers before finding one that would even write the policy. It seemed strange, but it was the best we could do.