December 11, 2018

Dwelling Insurance

Dwelling

A Dwelling policy is typically used to cover properties that are rented to others.  Most Homeowners policies require that the owner of the property be the primary resident of the home, so if the property is primarily rented to others, it usually has to be written as a Dwelling.  Unlike the Homeowners policy that comes with a lot of built in coverages, the standard Dwelling policy provides coverage for just the Dwelling and Other Structures (detached garages, sheds, fences, etc...).  You can then add coverage for things like Contents, Loss of Rent, and Liability coverage as needed.   

Most companies will write up to a 4-unit property on the Dwelling form.  Properties with more than 4-units usually have to be written on a Commercial policy.  All of our carriers require that they write your Homeowners policy in order to write a Dwelling policy.  We can sometimes get exceptions to this requirement for those temporally living out of the country.


Our policies usually provide the following coverages:

  • Dwelling - This protects your real property up to your policy limit, usually on a Replacement Cost basis.  It is important to note that unlike most Homeowners policies, most Dwelling policies do not provide any type of Dwelling extension.  If you have a $300,000 limit and it costs $350,000 to replace your property, you will only get $300,000.  Therefore, it is extremely important to make sure you have an adequate limit to fully replace your property.

  • Contents - Most policies only provide $1,000 for Contents because they assume you don't have any Contents in the rental property.  However, if you are renting out a home fully furnished, Contents coverage can be added.

  • Loss of Rents - It protects you in the event your tenant stops paying rent because they have to move out due to a covered loss to your property.  While your property is being rebuilt, you will have to continue to pay your mortgage, which is why it is so important to have adequate Loss of Rents coverage.  The limit is typically 10% of your Dwelling limit, but can also be increased if needed.  The policy pays the rent you would have collect had the loss not occurred, minus any expenses (like utilities) that you don't have to pay due to the loss.

  • Premises Liability - We quote all policies with $500,000 in Personal Liability coverage.  Higher limits are available via a Personal Umbrella policy, which we highly recommend for anyone who owns a rental property.  Everyone needs to have Personal Liability coverage, but especially rental property owners.  You are not only liable for your tenants getting hurt on your property, but you can also be held liable for the actions of your tenants.  For example, there have been cases were the property owners were held liable for their tenant's dog that bit someone.

  • Personal Injury Liability - This is one of the most important coverages to have if you own a rental property.  It covers you for things like invasion of privacy, wrongful eviction, false arrest, libel, and slander.  Unfortunately, most companies do not offer this coverage on their Dwelling policy.  Therefore, we often recommend that you purchase this coverage on your Homeowners policy, then add an endorsement to your Homeowners policy extending its' Liability coverage to also cover your rental property.  Not only does this give you better coverage, it is often cheaper than getting the Liability coverage on the Dwelling policy. 

 

Our Dwelling Companies Include the following:

ACE Private Risk Services
ACE Private Risk Services
AIG Private Client Group
AIG Private Client Group
Fireman's Fund Travelers
The Hartford The Hartford Products



Contact us today for more information about Homeowners Insurance or fill out our online quote form.

3201 New Mexico Ave NW #300
Washington, DC  20016
202-966-0700
Info@howard-hoffman.com