Honeowner insurance versus landlord insurance

Dallas, Texas
Insurance
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Honeowner insurance versus landlord insurance

James KimPro Member
Investor · Los Angeles · Member since 2021 · 89 posts · 23 votes

Hi,

Is landlord insurance always more expensive than homeowner insurance? 

I have a home in California and investment property in Dallas and I'm noticing this difference. Maybe its a state by state difference? But my insurance for investment property is more than my home in CA. Just curious is its normal that homeowners insurance is always cheaper than landlord insurance.

Thanks!

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Rod HanksBusiness Member
Insurance Agent · Dallas, TX · Member since 2013 · 743 posts · 462 votes
4y
Quote from @James Kim:

Hi,

Is landlord insurance always more expensive than homeowner insurance? 

I have a home in California and investment property in Dallas and I'm noticing this difference. Maybe its a state by state difference? But my insurance for investment property is more than my home in CA. Just curious is its normal that homeowners insurance is always cheaper than landlord insurance.

Thanks!

DFW has one of the highest property insurance rates in the country due to the hail storms. So not a fair comparison. 
Rod Hanks Insurance4.9156 Reviews
WebsiteView Page
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  • George Red
    Investor · Member since 2022 · 157 posts · 162 votes
    4y

    Hey James, best wishes in your real estate adventure. I live in CA and have been buying in Kansas City and have found landlord policies to be more expensive… seems logical that there is more risk and thus a higher price in how a tenant would treat a property vs an owner.

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  • George Red
    Investor · Member since 2022 · 157 posts · 162 votes
    4y

    Hey James, best wishes in your real estate adventure. I live in CA and have been buying in Kansas City and have found landlord policies to be more expensive… seems logical that there is more risk and thus a higher price in how a tenant would treat a property vs an owner.

    0Reply
  • Adam Martin
    Rental Property Investor · Member since 2020 · 1k+ posts · 1k+ votes
    4y

    I think you just aren't comparing apples to apples since they are in different geographic locations which can affect rates.  I invest and live in the same area and my policies are always several hundred dollars cheaper a year for rentals.  My agent explained to me that my renters policies don't cover as much since I only have 5k in personal property for my appliances.  If the house burns down and the tenants stuff goes up in smoke that is what their renters insurance policy covers but my insurance won't touch it and I stress that in the beginning as to why they have to get renters insurance.  

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  • James KimPro Member
    OP
    Investor · Los Angeles · Member since 2021 · 89 posts · 23 votes
    4y

    @George Red thanks for the feedback!

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  • James KimPro Member
    OP
    Investor · Los Angeles · Member since 2021 · 89 posts · 23 votes
    4y

    @Adam Martin thanks for the feedback!

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  • John Mocker
    Insurance Agent · Norwalk, CT · Member since 2016 · 2k+ posts · 1k+ votes
    4y

    James,

    I have found when comparing Homeowners policies to Landlord (Dwelling/Fire) policies that the Homeowners is generally less expensive.  Usually the Homeowners is less expensive even though it provide some coverage (Contents for example) that the Landlord policy does not (or at much lower limits).  It has to do with the average claims for the type of business.  Generally a Homeowner is going to treat their property better than a tenant occupied property.

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  • James KimPro Member
    OP
    Investor · Los Angeles · Member since 2021 · 89 posts · 23 votes
    4y
    Quote from @John Mocker:

    James,

    I have found when comparing Homeowners policies to Landlord (Dwelling/Fire) policies that the Homeowners is generally less expensive.  Usually the Homeowners is less expensive even though it provide some coverage (Contents for example) that the Landlord policy does not (or at much lower limits).  It has to do with the average claims for the type of business.  Generally a Homeowner is going to treat their property better than a tenant occupied property.


     Hi John,

    thanks for the feedback. Yours and other responders all make sense. I just found it interesting that my ca home that is far and away (more than 3 times) more expensive than my investment property in Dallas is much cheaper than the investment property insurance. I'm talking half the cost. But I guess I can see the point.

    Thanks!

    0Reply
  • Mark Frattini
    Real Estate Agent · San Diego, CA · Member since 2014 · 338 posts · 176 votes
    4y

    Hi @James Kim

    Lot's of variables to consider however I suggest working with an insurance broker that has access to different coverage options and carriers for your properties. Before I started working with my current agent my rental properties did not have the right type of coverage and I was overpaying. 

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  • Rod HanksBusiness Member
    Insurance Agent · Dallas, TX · Member since 2013 · 743 posts · 462 votes
    4y
    Quote from @James Kim:

    Hi,

    Is landlord insurance always more expensive than homeowner insurance? 

    I have a home in California and investment property in Dallas and I'm noticing this difference. Maybe its a state by state difference? But my insurance for investment property is more than my home in CA. Just curious is its normal that homeowners insurance is always cheaper than landlord insurance.

    Thanks!

    DFW has one of the highest property insurance rates in the country due to the hail storms. So not a fair comparison. 
    Rod Hanks Insurance4.9156 Reviews
    WebsiteView Page
    1Reply
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