Landlords Should Protect Their Income

As a landlord you have a lot to think about with your property: upkeep of the unit, finding good tenants, and paying the mortgage and property taxes. And if there is an unfortunate fire or other destruction of the property, tenants may be forced to vacate the property. Oftentimes the municipal code inspector will not allow the tenants to return until proper repairs have been made.

During this time, the landlord may suffer a loss of income as rents are typically not paid while the tenant is away. Obviously, having no rental income can be financially devastating.

Fortunately, there is an insurance coverage that can be purchased to protect the lost rental income. This is a valuable component that can greatly assist the landlord during the time (which can be lengthy) that repairs are being made to the property.

Loss of Rents Coverage (also called Business Income) is often listed as part of a package insurance policy. Be sure you carry this type of program. This policy covers the building, general liability as well as the Loss of Rents Coverage. The cost is fairly minimal but you want to be sure you carry a sufficient amount to cover at least 12 months of potential lost income.