Not having to worry about complicated situations when renting out your home is priceless, and that is basically what rent protection insurance (or rent guarantee insurance) is all about.
But what does rent protection insurance really mean, and what does it actually cover? Today’s article by ShMadrid will focus on this type of insurance.
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What is rent protection insurance and how does it work?
It is more and more common these days to take out insurance for the non-payment of rent by tenants, and this makes home owners more sure that they will keep receiving income from their property. Taking on the role of landlord is not always that easy. The most complicated part is, in fact, finding tenants who meet your expectations.
The risk of renting out your property is absolutely worth it when you receive monthly rent, but what happens when a tenant suddenly stops paying? Non-payment of rent is something that keeps many landlords up at night. And an unpleasant situation with a tenant because of overconfidence or bad luck is definitely not on any home owner’s wish list.
Rent protection insurance offers financial guarantees for the rent you are supposed to receive. Having this type of policy offers some form of security, which is key when deciding to rent out your property.
Many people are unaware of this type of insurance, or do not know the ins and outs, so we are going to list a few specifics here, in order for you to learn what it consists of, and why it is more complete than a traditional home insurance policy, which is subject to this type of clause.
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Currently there are different types of rent protection insurance, and they provide different coverages, adapted to the needs of each home owner. These are the main guarantees they offer:
- Non-payment of rent. If it happens that tenants stop paying rent, rent protection insurance covers the outstanding monthly payments. The options are: 6, 9 or 12 months.
- Eviction expenses. If the situation becomes too complicated, and you see no other way out than to evict the tenants, the insurance covers lock changing costs.
- Vandalism caused by tenants. Sometimes you have to fix damages caused by acts of vandalism. Rent protection insurance covers damages caused by your tenant.
- Legal advice by telephone. If you have any doubts or questions on legal matters (related to your home), the insurance helpdesk can – quickly and accurately – provide you with necessary answers and solutions.
- Legal defence. Your interests will be protected by professionals with extensive legal experience.
If you have decided to rent out your property, consider taking out an insurance policy for the non-payment of rent. Ask for several quotes with different insurance companies, and compare these to find the one that suits your situation best. Once you have signed with an insurance company, just follow its instructions to successfully rent out your property to tenants.
Some insurance companies even offer the possibility to check potential tenants, to select the best one for you. Once they have decided on a positive candidate, you can have peace of mind for renting your property out to the best possible tenant, and feel a sense of security because of the coverage the insurance offers.
Have you considered taking out rent protection insurance?