Are you one of the many Wisconsin residents who owns a second home or a vacation property? If so, chances are you’ve thought about renting out that property at one time or another. Whether you are interested in earning an extra income to help pay off your mortgage or you simply don’t like the idea of your beautiful second home going to waste, becoming a landlord may seem like a great solution to your problem. But before you start putting up ads in the classifieds or hopping on Airbnb, it’s important to consider the amount of work and time you’ll need to commit to being a new landlord.
In particular, Wisconsin homeowners should keep in mind that your regular home insurance policy probably won’t cover converting your home into a rental. And while you do have the option of special Host Protection Insurance with companies like Airbnb, don’t forget that this types of policy come with its own set of conditions, exclusions, and limitations.
What Type of Insurance Do I Need to Rent Out My Second Home?
While your current home insurance policy is in place to help protect your investment, the coverage isn’t likely to extend to cover a rental property. Having the right level of insurance protection in place is necessary to protect your home, your tenants, and your financial future. To avoid some major headaches down the line, there are a few things you should know about insurance before you rent, including:
You Probably Need Additional Coverage
Your standard home insurance policy doesn’t typically cover any damages that may occur when your vacation property is being used as a rental. This means that you’ll most likely need to invest in landlord’s insurance or possibly small business insurance coverage.
Does Your Space Qualify as a Rental?
If you are unsure whether your future plans would actually be considered “renting,” it’s best to speak with your trusted independent insurance agent before moving forward. Different companies, cities and HOA’s have different rules set in place for what actually qualifies as a rental, so doing your research is always a good idea.
Long-Term Renters Need Insurance
If you give short-term rentals a try and decide you’d like to convert your home into a long-term rental property, encourage your tenants to invest in renter’s insurance. Not only will this coverage help to protect their personal belongings, it can help to prevent them from having to pay for certain damages out-of-pocket, which helps you to protect your investment as well.
Other Topics to Consider Before Renting
While becoming a casual landlord via Airbnb and other hosting companies may seem like an easy way to make some fast cash, there is actually a lot of work that goes into preparing your home for the rental market. Some other important considerations you should discuss with your family include:
- Time – How much time are you willing to put into your rental? To get started you will need to make sure your home is safe for new renters. You will need to complete regular maintenance on the home and be prepared to fix any issues that arise along the way. Additionally, the time that it takes to set-up your rental account can be great as well.
- Neighbors – Have you spoken to your neighbors about the idea of renting out your second home? If you’ve been avoiding the issue because you have a feeling they won’t be too pleased, maybe this isn’t the best way to go.
Contact Mayville Insurance Today
If you are interested in becoming a short-term or long-term landlord, you should speak with your home insurance agent before making any final decisions. For more information on the benefits of total insurance protection, contact our friendly agents at Mayville Insurance today and be sure to request a free quote!