A West Texas Guide to Reviewing Insurance Before Renting Out Your Home
Are you planning to rent out a house in Midland or Odessa, Texas?
Maybe you’ve purchased another home and decided to keep your previous property as a rental. Or perhaps you’re buying your first investment property in the Permian Basin.
Before your tenant moves in, there’s an important question to consider:
Does your current insurance policy reflect how the property will actually be used?
A homeowners policy written for an owner-occupied residence may not be appropriate for a property that is rented to others.
Understanding the difference can help you make a more informed insurance decision.
Short Answer
If you’re converting your home into a rental property in Midland or Odessa, consider contacting your insurance agent or company before the occupancy changes.
Insurance companies have different eligibility requirements and coverage provisions depending on whether a property is owner-occupied, tenant-occupied, vacant, or used for short-term rentals.
A landlord or rental dwelling policy may be an available option, depending on the property and insurance company.
1. Why Does Occupancy Matter?
Insurance companies consider how a property is occupied and used when evaluating insurance eligibility and coverage options.
For example, a house may be:
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Occupied by its owner
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Rented to a long-term tenant
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Used as a short-term rental
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Temporarily vacant
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Undergoing renovations
These situations may involve different underwriting requirements and policy provisions.
If you’re moving out and renting your home to someone else, notify your insurance agent or company so the change can be reviewed.
Do not assume your existing homeowners policy automatically provides the same coverage after the occupancy changes.
2. What Is Landlord Insurance?
Landlord insurance, sometimes offered through a rental dwelling or dwelling fire policy, is designed for certain properties that are rented to others.
Depending on the insurance company and policy, available coverage options may address:
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The dwelling
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Certain other structures
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Specified landlord-owned personal property
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Certain liability exposures
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Loss of rental income under specified covered circumstances
Not every landlord policy includes all these coverages.
Coverage must be evaluated based on the actual policy, endorsements, exclusions, limits, and conditions.
3. Does Landlord Insurance Cover a Tenant’s Belongings?
Landlord insurance generally is not intended to insure a tenant’s personal belongings.
Tenants may want to consider renters insurance for their own personal property and liability needs.
The coverage available under a renters policy depends on its terms and conditions.
Landlords should review their own policy rather than assuming a tenant’s insurance addresses the landlord’s exposures.
4. Review Your Roof and Deductibles
For rental properties in Midland, Odessa, Midland County, and Ector County, roof information and deductibles can be important considerations.
Depending on the insurance company, underwriting may consider:
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Roof age
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Roof material
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Roof condition
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Previous replacement information
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Other property characteristics
A deductible is generally the amount or percentage that may apply to the insured’s portion of a covered loss, subject to the terms, conditions, and provisions of the policy.
Some policies may have different deductibles for different types of losses.
When comparing landlord insurance options, review the premium, deductibles, coverage provisions, and any applicable roof-related limitations.
5. What About Loss of Rental Income?
Some landlord insurance policies may offer coverage for qualifying loss of rental income when a covered event makes the insured property unfit for rental use, subject to the policy’s specific requirements.
However, this coverage should not be confused with protection against every situation involving unpaid rent or vacancy.
Coverage triggers, exclusions, waiting periods, limits, and other conditions can vary.
Ask your insurance professional what options may be available and how the policy provisions apply.
6. Long-Term and Short-Term Rentals May Have Different Requirements
Renting a home to a long-term tenant is not necessarily treated the same as offering the property for short stays through a vacation rental platform.
Insurance companies may distinguish between different rental arrangements.
If you plan to use a property for short-term rentals, disclose that intended use when requesting insurance options.
Do not assume a standard landlord policy automatically addresses short-term rental activity.
7. What Information Should You Have Ready for a Landlord Insurance Quote?
If you’re requesting insurance for a rental house in Midland or Odessa, it may help to have the following information available:
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Property address
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Year built and approximate square footage
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Roof age and replacement information
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Construction details
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Property updates or renovations
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Current or intended occupancy
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Whether the property will be rented long-term or short-term
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Available prior insurance information
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Other information requested by the insurance company
Additional information or inspections may be required depending on the property and insurer.
Own More Than One Property? Consider Reviewing Your Overall Insurance
Some Midland and Odessa property owners have a primary residence, rental property, vehicles, or other assets.
When reviewing insurance for a rental property, it may also be a convenient time to discuss your overall insurance needs.
An independent agency can discuss available options through the insurance companies it represents.
Some property owners may also want to ask about umbrella or other liability insurance options, subject to eligibility, underlying insurance requirements, and policy provisions.
There is no single insurance arrangement that’s appropriate for every household or property owner.
Frequently Asked Questions
Can I keep my homeowners insurance if I rent out my house?
It depends on the insurance company, policy provisions, and circumstances. Before changing the property’s occupancy, contact your insurance agent or company to discuss the intended use and available options.
Is landlord insurance more expensive than homeowners insurance?
Pricing varies based on property characteristics, occupancy, coverage, deductibles, underwriting factors, and insurance company. There is no universal price comparison that applies to every property.
Does landlord insurance cover damage caused by tenants?
Coverage for tenant-related damage depends on the cause of loss and the policy’s specific terms, exclusions, conditions, and endorsements. Do not assume all tenant-related damage is covered.
Do I need landlord insurance if the house is paid off?
Even without a mortgage, a rental property can present property and liability exposures. Available insurance options depend on the property, its use, and the insurer’s requirements.
Can Killebrew Insurance help with rental properties in Midland and Odessa?
Killebrew Insurance LLC can review the property information you provide, answer questions, and discuss available rental property insurance options through the companies we represent, subject to eligibility and underwriting requirements.
Renting Out a Home in Midland or Odessa? Let’s Review Your Options.
Whether you’re converting your previous home into a rental or purchasing an investment property, consider reviewing your insurance before the property is rented.
Killebrew Insurance LLC is a local independent insurance agency serving Midland, Odessa, and West Texas.
We’d welcome the opportunity to discuss available insurance options for your rental property.
Midland: 432-694-0508
Odessa: 432-332-6322
Email:
Website: www.killebrewinsurance.com
Helpful Resources
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Texas Department of Insurance — Home Insurance — Consumer information about homeowners insurance and coverage considerations.
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Texas Department of Insurance — Additional consumer resources on insurance policies, deductibles, and shopping for coverage.
Important Insurance Information
This article is provided for general educational purposes only and is not intended to provide specific insurance, legal, real estate, or financial advice. Coverage, pricing, eligibility, underwriting requirements, claims handling, exclusions, and policy provisions vary by insurance company, policy, property, and individual circumstances. Not all coverages described are included in every policy or available through every insurer. Review your individual insurance needs and policy documents with a licensed insurance professional.
