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Dwelling vs. Home Insurance

from Brodbeck Porter Insurance Agency

Dec 8, 2014

There are two types of people: those that dread the winter with all of the cold weather and snow that it brings and those that love winter activities. Anyone that loves hitting the slopes or taking out their snowmobile, or outdoor ice skating look forward to this time of year. For those of us not gifted in the ways of balance or coordination, we will stick to enjoying the sunshine and beaches.

If you are a fan of the snow and ice and the fun it can bring, the ultimate treat is having a second home in a ski dwelling coverage area. New England is home to great places to ski, with all of the great mountains in New Hampshire, Vermont, and even Massachusetts. For people that have a ski home, there is a bit of responsibility that comes with owning it.

One of the main headaches that comes with owning a second home, no matter where it is, is dealing with opening that home up to renters. When it comes to your insurance coverage and deciding if you need dwelling coverage or regular homeowners insurance, the first thing to do is figure out how often you will be renting your home out.

If the plan is to just renting it to one family for a couple weeks it would be insured one way. However, if you are renting the home out all year round and to a different family every week, the home would need to be covered another way.
Dwelling Coverage

Dwelling Coverage is also sometimes referred to as rental property coverage. This is coverage for people who own property that they consistently rent out. We will take more about renting out for maybe just a week of the season or having family and friends stay at your property below. Think of dwelling coverage as coverage that a landlord will need.

Homeowners Insurance: A renter will typically have their own renters insurance policy if it is a long stay, which will protect their belongings, but as a landlord you should make sure you are prepared to cover things on your end. For a shorter stay, the tenant will most likely bring liability and personal property coverage from their home, condo or renters insurance policy they have for their main residence.

As a landlord, you are required to protect the structure and property with a landlord’s policy. If your ski house catches on fire, it will be your dwelling coverage that helps you repair and rebuild, not the coverage of the tenants. In addition to covering the structure of the building, dwelling coverage offers coverage options for attached structures, detached structures, personal property left on-site for maintenance or tenants use such as appliances, furniture, lawnmowers, etc.

Another coverage you can get with rental property coverage is liability. In the event that one of your tenants or their guests are hurt on your property, and your property is found to be at fault. If they have medical bills or legal fees arise, you could have the liability coverage you need.

Homeowners Insurance

If you own a home and you rent it out for really short periods of time and for the most part you are the main tenant, dwelling coverage may not be necessary. If you are unsure about it, it’s best to double check with your insurance agent.

In the event that you do rent out your home for a short period of time, you’ll still want to be sure you have enough coverage for those guests. For example, if their skis get stolen while they are at your house, they are covered under the personal property portion of their homeowners insurance policy because it is their personal property. On the other hand, if they get hurt on your property, you are protected by your liability coverage.

When renting, there are some things that you should do before guests arrive to limit your risk as the owner of the property.

These include:

Make sure all stairways, inside and out, have handrails

Make sure you have a signed lease that has been prepared or reviewed by a lawyer

Keep the driveways and all walk-ways well plowed and sanded

Make sure it is well lighted. Use motion sensor lights

Remove any Wood Stoves.

Don’t allow the use of space heaters

Make sure all smoke detectors and carbon monoxide detectors work. Make sure there are working fire extinguishers in easy to reach places

Do a thorough inspection in between tenants

As the owner of home, it’s important you make sure to cross your t’s and dot your I’s when it comes to your insurance. Even opening up your doors to friends and family, if it goes wrong, could result in law suits or medical bills that could cost you your home.

Always contact your insurance agent if you decide to rent out your home, even for a short period of time. They can walk you through the right coverage for your situation. Each homeowner, property, etc. makes for a unique experience and the best person to help determine the right insurance coverage is your agent.

Never hesitate to call us at (513) 624-0900.

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