When it’s time to think about protecting your Portland rental property, it is important that you do more than the bare minimum.
The value of protecting your rental property cannot be overstated. Not only is it essential to maintain the integrity and condition of your investment; but it’s also helpful for your peace of mind. Adequate insurance coverage is a good place to start. But, you need more than landlord insurance.
You’re protecting your property from bad tenants, from weather and other elements, from damage, and from unexpected risks. Let’s take a look at the comprehensive steps you’ll want to take to fully cover your Portland rental property.
Landlord Insurance is Where You Start
Landlord insurance is a type of insurance policy designed specifically for property owners who rent out their homes or apartments to tenants. It not only provides coverage for property damage and liability claims, but also protects you from the financial loss that could result from theft, fire, or natural disasters.
Here is what you can expect a comprehensive landlord insurance policy to cover:
Property Damage Coverage
One of the main coverages offered by landlord insurance is property damage coverage. If your property is damaged by fire, wind, hail, vandalism, or any loss that occurs because of those covered events, your property damage coverage will pay for whatever needs to be repaired or replaced.
Landlord Liability Coverage
Protecting yourself against liability is just as important as protecting the physical structure of your property. So, a good landlord insurance policy will include liability insurance. This coverage protects you from lawsuits related to injuries or damages that could potentially occur on your property. For example, if your tenant slips and falls on a wet floor in your building, you could be held liable for their medical bills and damages. Liability coverage can help protect you from financial loss in these situations.
Rental Income Loss Coverage
Look for a landlord policy that includes loss of income coverage. In the event that your rental property becomes uninhabitable due to a covered loss, rental income loss coverage can help replace the income you would have received during the time the property is being repaired. This coverage can help you cover expenses such as mortgage payments, property taxes, and insurance premiums during the time that you’re unable to collect rent for your tenants. You can also ensure that hotel bills are covered or other lodging arrangements are possible.
Landlord insurance can be a valuable investment for any landlord. Not having adequate coverage will only cost you more when something happens.
Keep in touch with your insurance agent and make sure your policy is adequate and reflects the potential recent changes in your property value. If you’re not already working with an insurance agent, get a referral from a Portland property management company.
While landlord insurance is a great place to start, it’s not the only thing you’ll need to protect your rental property in Portland. There are many other ways to ensure your rental home is safe and functional.
Require Renter’s Insurance from Portland Residents
You have likely done a thorough job screening your residents, and as much as you want to trust them, accidents and disasters can happen without any notice or warning. Even as you do your best to maintain your investment property, it's important to recognize that you can't control everything.
Prepare yourself and your tenants for the potential of property damage and accidents. Require renter’s insurance.
Many Portland residents mistakenly believe that they're covered under their landlord's insurance policy, but this is not necessarily the case, especially when it comes to the resident’s personal belongings. If there happens to be a fire or a flood at your rental property, or there’s vandalism or a theft, your insurance policy will not cover your resident’s personal belongings. When you require them to carry renter’s insurance, you’re making sure your tenants are protected and have the coverage their need to repair or replace their belongings.
There’s also the matter of tenant liability. Residents can seriously damage your property, and not intentionally. How will they make it right?
If a tenant forgets to turn the water off in a bathtub, there could be extensive flooding and water damage to the property. You should not have to pay for that. In this case, your tenant’s renter’s insurance policy would.
You’re protecting your own policy, your own finances, and your investment property. You’re also reducing your own liability. Accidents happen, and if a tenant is injured on your property, you could be liable for their medical expenses. By requiring renter's insurance, you protect yourself from that liability. If a tenant should somehow become injured in their own home, their insurance will cover their medical expenses, rather than the cost falling back on you.
Renter’s insurance is extremely cost-effective. Most residents will be able to find a great policy for less than $20 per month. It gets even cheaper when they bundle with other insurance policies, such as car insurance.
Add language to your lease agreement that requires renter’s insurance, and make it clear to tenants before they sign the lease that you’ll expect to see proof of insurance.
Create a Strong Lease Agreement
Another great way to protect yourself and your property is with a strong lease agreement.
A lease agreement is a legally binding contract that outlines the terms of the rental agreement between you and your resident. It's important to have a lease agreement that covers all the necessary details so that you can protect yourself and your property in case problems arise.
If there’s a dispute about what you’re responsible for in terms of protecting your property and what your resident is responsible for, you’ll be able to refer to the lease agreement to settle the conflict.
The lease agreement also ensures rent comes in on time. It limits what the property can and cannot be used for. You don’t want your residents renting it out on a nightly basis, for example, so you’ll include a clause in the lease that prohibits subletting. This will protect you and your property from the risk that comes with a revolving door of tenants and guests who have not been screened or approved. The lease can also protect you by including policies on:
Pets
Smoking
Visitors
Noise levels
Protect yourself from HOA violations by including any community association rules and regulations in the lease.
One of the most important reasons to have a strong lease agreement in place is to protect you from financial loss and damages. Your lease agreement should include details on security deposits, which can be used to cover any damages or losses caused by the tenant. This can help you recoup any losses incurred as a result of tenant behavior.
Portland Property Management
Professional property management in Portland will lead to an asset that’s better protected.
Your property manager will ensure you are financially and materially protected by screening tenants better, maintaining your home preventatively, ensuring you’re complying with all laws and regulations, and managing tenant relationships to reduce conflict and disputes.
One of the most significant risks to your rental property is an unqualified tenant. Placing the wrong tenant can lead to damaged property, missed rent payments, and even legal issues. Professional property management companies have systems in place to screen and select high-quality residents. We will check references, perform credit checks, and verify information that’s gathered on the application. Our job is to protect your property by ensuring that tenants are reliable, trustworthy, and able to take care of your property.
Another significant benefit of professional Portland property management is that you know your property will be maintained. There’s less of a risk that you’ll fall victim to deferred and unreported maintenance issues. We also work with licensed, insured, and reliable contractors who can do everything from routine maintenance tasks (such as painting and cleaning) to major repairs, such as fixing a roof or replacing an appliance. When repairs are made promptly, you’ll have fewer long term expenses and you won’t have to worry about accelerated deterioration of your property or its systems.
Working with a professional property management company can help ensure that you stay in compliance with applicable laws and regulations, including fair housing laws, building codes, screening requirements, security deposit laws, and eviction procedures. Failure to comply with these regulations can lead to costly fines and potential lawsuits.
Buying a good landlord insurance policy is critical to successfully and safely renting out a Portland property. However, you have to do a lot more than that, especially now, when there are so many risks that come with being a landlord. Make sure you’re requiring your residents to be covered as well, with a renters insurance policy. Put together a lease agreement that protects your property as well as yourself and your residents. Finally, invest in professional Portland property management. It provides a lot of value and enables you to enjoy peace of mind around your investments.
We can give you some further direction. Please contact us at PropM, Inc. We’re here for you seven days a week.
