Landlord Insurance, 1-4 Unit Rentals, What You Should Know: Named Peril & Special Dwelling Policies

First, all features described can vary by state and jurisdiction, carrier, property type, owner, and other particulars. They are subject to change without notice. The following is a very general summary only. Refer to the actual policies for complete details, conditions, and limitations.

That said, the landlord needs tenant-occupied Dwelling Property coverage. For duplexes through 4 units, the landlord could be living in one of the units. There are also instances where vacation/seasonal single-family dwellings may be occupied for part of the year by the owner/landlord. Again, refer to the actual Dwelling Property policy.

Typically, the following are covered: dwelling structure, certain construction materials and supplies, certain building and outdoor equipment, other structures on the residential lot, and certain of the landlord's personal property on the premises. The policy forms typically expressly exclude a number of types of personal property, motor vehicles being just one example.

Other things covered under the Basic form usually include debris removal, reasonable repairs, fire department service charges, and loss of rents due to property damage.

There are three main types of Dwelling Property forms. The first two types (Basic and Broad) are "Named Peril." Under the Named Peril type, the insurance company will pay for losses due to perils expressly named in the policy. The landlord is not covered against unnamed perils. In very general terms (the policy narrows down the exact perils), the following are typically the Named Perils in the Basic, as opposed to the Broad, form:

  • Fire Or Lightning
  • Internal Explosion

The following are generally optional under the Basic form:

  • Aircraft [interestingly enough, including "self-propelled missiles and spacecraft"]
  • Explosion
  • Riot Or Civil Commotion
  • Smoke
  • Vandalism Or Malicious Mischief
  • Vehicles
  • Volcanic Eruption
  • Windstorm Or Hail

Certain things are expressly excluded even though the policy is of the Named Perils type. They are typically as follows:

  • Earth Movement (not to be confused with volcanic eruption)
  • Governmental Action
  • Intentional Loss
  • Lawns, plants, shrubs or trees outside of buildings
  • Neglect
  • Nuclear Hazard
  • Ordinance Or Law
  • Power Failure
  • War
  • Water Damage

The Broad form typically covers additional living expenses while the property is being repaired or replaced and covers a number of other things absent in the basic form above, generally such as: trees, shrubs, plants or lawns; collapse; and glass or safety glazing material.

These are by no means exhaustive lists or explanations. It cannot be overstated that the policy forms are quite specific about the particulars of where and when and under what circumstances things are covered or excluded and to what degree.

In addition to what the Basic form covers, the Broad form commonly includes the following:

  • Accidental Discharge Or Overflow Of Water Or Steam
  • Damage By Burglars
  • Falling Objects
  • Freezing
  • Sudden And Accidental Damage From Artificially Generated Electrical Current
  • Sudden And Accidental Tearing Apart, Cracking, Burning Or Bulging
  • Weight Of Ice, Snow Or Sleet

Exclusions are usually the same as for the Basic form.

Lastly, we have the Special form. The Special form is not a Named Peril form. Generally, if the peril is not expressly named, the peril is covered. The Special form extends the greatest coverage and is recommended.

On top of the considerations above are choices of deductibles and limits.

However, the landlord and manager/firm truly should not stop there in considering insurance coverages for the business. Other often must-have insurance includes:

  • Accounts Receivables
  • Automobile Liability and Physical Damage
  • Business Income and Expense
  • Computers and Computer Fraud
  • Crime
  • Earth Movement
  • Employee Benefits
  • Employee Dishonesty
  • General Liability
  • Hired and Non-ownership Auto
  • Landlord/Manager Personal Property (beyond that for tenant use)
  • Money and Securities
  • Umbrella
  • Valuable Papers and Records
  • Water Damage (beyond that covered by the Dwelling policies described above)
  • Workers Compensation

Also consider:

  • Crisis-Event Management
  • D&O (Directors and Officers Liability Insurance): This could be important to you if you are other than a sole proprietorship.
  • E&O (Errors and Omissions, Professional Liability Insurance): If you manage other than your own properties and/or landlords use you as a professional consultant, we strongly recommend E&O coverage.
  • Environmental Liability: Do you deal with or store environmentally hazardous materials?

Now take action: More and additional specific coverage information offered by PropertyPak™

What PropertyPak™ doesn't have available on this site, Hill & Usher usually does. (PropertyPak™ is a division of Hill & Usher.) Refer to the menu-bars at the top of this page to click through to other Hill & Usher offerings.