Do I Need Extra Insurance if I Am Renting Out a Room in my Home?

A lot of homeowners have extra space in their homes that they don't know what to do with. Sometimes, to make some extra money, homeowners decide to rent out the room to someone. This can actually be a great way to make some extra cash, but it's something that needs to be approached with care. You need to consider things like insurance if you want to make sure that your home and your tenant are going to be protected, especially in the event that they need a rental unit during home repair.

When you secure a homeowners insurance policy, it is going to provide coverage for structural damage that occurs to your home. There will be certain perils and hazards that are going to be covered and certain ones that will be excluded. The coverage that you choose, though, is going to cover the entire home plus any adjacent structures in your yard. It does not matter whether you rent out your room or not, the policy will cover this no matter who is living inside the home. As far as this area is concerned, you will not have to get extra coverage to deal with having a renter in one of your rooms.

Coverage for Personal Items

When you select a homeowners insurance policy for your home, it's also going to cover your personal belongings. That means any of your items that are damaged are stolen can be claimed on your policy. However, this coverage is not going to apply to someone who you are renting a room to. A lot of people make the mistake of thinking this, and when something happens, they get a big surprise. You don't want this to happen to your renter, so it's important for you to speak with them about their own coverage.

If your renter wants to make sure that his or her property is going to be covered, then he or she will need to secure renters insurance. Renters insurance will help to pay for personal belongings that the renter owns. It will be up to him or her to choose a coverage amount that is going to take care of all of the possessions. If too little coverage is purchased, then the policy might not end up paying for all of the items to be repaired or replaced.

The best thing that you can do before you rent out a room is to sit down with potential renters and explain the situation. A lot of renters are going to be unaware of this, so they're not even going to know that they will need to get renters coverage. Once you explain these needs to them, then you'll both be in a better position. If you want to, you may wish to refer your renter to your homeowners insurance provider, if the company also offers coverage for renters. You may be able to get a bonus for referral from your provider.

Make Sure You are Covered

No matter what you do, you need to make sure that you have proper levels of homeowners insurance coverage for your home. You'll need to make sure that your asset is protected with or without a renter in it. You do not need to get extra insurance if you are renting out a room in your home, but you need to have enough coverage that will protect your home's structure from harm. Once you have secured this type of coverage, then the responsibility lies with your renter to get other coverage for his or her items.

safe secure

Enter your zip code for affordable home owners insurance quotes


What People Are Saying

"When a hail storm hit our town and destroyed all my windows, I was glad that I had found this site and was able to get a great rate on homeowners insurance. I've been able to make home improvements with the money I keep saving every month."

- Rita E, Atlanta GA