Florida Homeowners Insurance Coverage
Florida Homeowners Insurance Coverage
In recent years, homeowners in Florida have seen their insurance rates skyrocket. Surveys have shown that the top reasons for this change are a lack of awareness of hurricane risks and an increased number of claims filed by homeowners in Tornado Alley. In addition, there was an increase in foreclosures as property values declined during the recession and now homes are being sold to pay off debt rather than to make improvements. As such, more people are living in their homes with less money available for repairs or upgrades.
This combination has led insurance companies to set higher rates without a corresponding decrease in risk factors. As a result, financial and legal terms will be used throughout this article to better explain insurance coverage and terms.
Florida is a state that experiences the highest number of hurricanes in the country. Tropical storms can cause flooding, property damage and in some cases death. The relatively short distance between Florida and the Caribbean makes them especially vulnerable to tropical storms, both directly from wind damage but also indirectly by exacerbating existing natural disasters such as the 2011 Haiti earthquake.
Under Florida Statutes 627.632, it is illegal to construct, renovate or repair any structure above the current high water mark without a permit from the Florida Division of Emergency Management (FDEM). The county tax collector's office will have a map that shows the current high watermark. Permits are limited and only available for structures below 100,000 dollars in value.
In addition to flood insurance, homeowners may want to purchase hurricane insurance. This coverage may cover losses from wind damage or floods connected with hurricanes that occur between June 1 and Labor Day. It does not cover any losses that occur during other time periods. This coverage is more expensive than standard homeowner's policies.
Homeowners can buy a service contract with their association to pay for any required repairs. Some associations provide more coverage than others and charging higher fees.
BYOD (Buy/Own/Deed) insurance covers homes that are not owned by the homeowner. Typically, if you rent your home out, you may have some protection against damage caused by tenants; however that protection is limited. If you own your home but rent it out, there are many different types of coverage that may make your property more secure from damage caused by tenants - such as landlord insurance. This policy is often obtainable through a home insurance company and provides coverage for losses to the landlord’s property as a result of things such as fire or theft, which may be caused by tenants.
If you own your home but do not live in it full-time or rent it out, there are several types of insurance that can be obtained to protect you from losses due to damage that your tenants cause. If you own your home but rent it out, if you do not have tenant liability coverage or homeowner's insurance that includes "loss of rent" coverage, any rental income you earn will not protect against loss of income due to repairs needed after a fire or other disaster. The state of Florida does not require tenants to obtain renter's insurance, but it is highly recommended by home insurers and real estate agents. coverage may vary.
In some cases, if you are renting out your house, your landlord will include insurance with the rental agreement that will protect them from any damages that could happen to the property. However, this protection only covers damage done by the tenant within the house, not by anything like faulty wiring or plumbing that may also be a result of a tenant. If you have any worry about potential damage being caused by your tenants there are several types of self-insurance protection available through companies such as World Porters Insurance - http://www.worldportersinsurance.com/ .
BYOP (Buy/Own/Policy) insurance is similar to BYOD in that it covers homes that are not owned by the homeowner. However, in BYOP, the owner of the property has also purchased an insurance policy on their home that is separate from any homeowners' policy they may have on their primary residence. In this situation, in order for there to be coverage for a loss, there must be damage caused by an insured peril as well as damage to the exterior or structure of the home. If you want to purchase this type of insurance there are a number of companies available that sell policies that are specifically designed for houses that are rented out regularly.
Many companies that offer leasehold insurance issue these policies to the landlord, however, since the owner of the property is renting out their home it makes more sense for them to have the policy on their property. This type of insurance is generally less expensive than buying a comparable policy as a homeowner. Emphasis here must be placed on what is considered "comparable." Coverage for damage caused by fire or other insured perils are not covered by most rent-to-own policies. Renters and owners should make certain that they understand what limitations are in place before purchasing this type of coverage.
- Contact your insurance agent to see what type of coverage is available for a loss due to fire or other hazards.
- Find out how much coverage your policy will provide and if there are any limits on the amount of money you will receive in the event of a claim.
- Find out how much coverage you have against personal property damages. For instance, if a tenant breaks your toothbrush and claims it as lost in transit, you may find yourself footing the bill for new toothbrushes every few months. This is one simple example that highlights how important it is to understand what exactly is covered by the policy. Ask to see an example policy and read through it carefully before purchasing one of these types of policies.
- Look up whether the policy covers "rental dwelling" or just the structure.
- Most policies do not cover vacation homes with tenants. However, if you are worried about a potential loss occurring during your vacation, obtaining homeowners' coverage may provide some sense of peace of mind. It is a good idea to contact your insurance agent and make certain that you understand exactly what types of coverage are available before buying additional insurance. Insurance companies will offer discounts for bundling policies together and it can be well worth the effort for larger dollar amounts to be insured jointly.- Ask if there are any other options available to protect yourself against any damage that may occur due to tenants' actions.
Conclusion
With the number of people who choose to rent their homes on the rise, policies that provide insurance for renters are becoming more popular. If home insurance is not already included, it may be worth your while to look into purchasing insurance for these types of situations. You can find a number of companies online that offer policies specifically designed for leases and rentals. If you do decide to purchase this type of policy, read over it carefully before you sign anything and check with your agent to make sure you understand the terms and limitations before agreeing to purchase a policy from any company.
If you are interested in learning what type of rental home insurance is available in Florida there are several businesses that specialize in this type of coverage.