The Right Questions to Ask When Choosing an Insurance Policy for Your Vacation Home
Your homeowner’s policy or personal liability coverage does not in any way cover your vacation rental property. This means the rental policy comes as a different package, and knowing the right questions to ask when looking for one will help you make the right choice.
It’s important to know whether an insurance considers your vacation property a business or commercial activity. This helps you know how comprehensive the policy will be and what can be allowed in the commercial property. In most cases, these are just terms an insurance agency uses to explain the policies but in most cases your rental property will only remain as that, for rental purposes only.
Is it possible to insure the income that comes from your rental property? This will most likely depend on what the insurance considers actual loss, there are some that offer protection and those who don’t. Find out what protection is offered and what the insurance considers as actual damage to your income. You can make a clear decision on whether it’s necessary to insure your income or just go with the usual disaster coverage such as hurricane or flood depending on the location of your vacation home.
The financial standing of your insurance should be a priority when shopping for one. Ask questions about the history of the company, experience, and financial ratings to be sure they can pay out your claims when something happens. If an insurance does not give you the answers you need, there are sites available to help check for insurance companies information and their policies as well.
If you’re planning to use your property as a business entity when it’s not being rented out, find out if the insurance you choose covers LLC (Limited Liability Company) entity as most insurance companies don’t combine both under one insurance.
All of these questions can help you find out if the insurance policy you are taking for your vacation rental property will cover most if not all of the damages.