We’ve already talked about a few insurance companies that have tapped into the market of offering coverage for short-term and vacation rentals. In this article, we’ll explore what Foremost’s short-term rental insurance covers and why they are a solid option for vacation rental property owners and managers.
What To Look for in Short-Term Rental Insurance
When shopping around for what insurance company to work with in getting coverage for your short-term rental property, there are several things you should consider. The ideal vacation rental property insurance plan is one that has aspects of homeowners, landlords, and commercial insurance policies.
It’s important to read the fine print when getting quotes from the insurance companies you’re considering. You might assume that a homeowners policy is the way to go, especially when you’re considering living on the actual property you’re planning to rent out. However, most homeowners policies will be voided once the insurer finds out you’re pursuing a business venture.
Since you are earning an income through your property, you could look into getting a commercial insurance policy, but this still severely lacks specific coverages you need for your vacation rental property, like loss of income and damage coverages.
A landlord policy could work, especially the one offered by Foremost Insurance. If you’re not planning to live in the property, Foremost’s policy could be a great fit.
Founded in 1952 in Michigan, Foremost Insurance was one of the pioneers of offering insurance coverages for mobile homes and cars. They’ve gained a reputation for being one of the insurance companies open to those who aren’t able to qualify for getting a policy through other insurance carriers by tailoring their coverages for customers’ specific needs.
Now part of the Farmers Insurance Group of Companies, Foremost is one of the leading insurance underwriters for cars, small businesses, home and dwelling properties.
How Foremost Insurance Protects Your Vacation Rental
Foremost Insurance basically offers an expanded landlord policy for your vacation rental, meaning you get everything on a standard Foremost Insurance landlord policy and more, depending on the needs of your short-term rental property. As a landlord policy, it is stipulated that you are not allowed to occupy the property you are renting out, which is a great option for many Vrbo property owners.
Foremost doesn’t require that your primary residence be insured with them in order to insure your seasonal or secondary property (though they offer a discount if you have multiple policies with them).
One of the biggest pros of working with Foremost Insurance is that you can customize additional coverages with them (for an additional cost, of course). Here’s a bit more about what a Foremost short-term rental insurance typically covers:
Standard Base Landlord Property Coverage – Foremost Insurance’s base coverage varies depending on the size and location of the property, but all of their landlord insurance plans include these features at a minimum: Actual Cash Value, Agreed Loss Settlement, Comprehensive Property Coverage, Optional Replacement Cost, Liability Coverage, and Extended Replacement Cost.
Loss of Income – This additional coverage protects you and makes sure that your business and property in the unexpected circumstance that you aren’t able to rent out your property while it’s undergoing damage repair and renovation, or if there’s nearby construction, and more.
Named Perils Coverage – This means that your property is protected from the damage done by natural calamities such as floods and earthquakes. Make sure to read the fine print though; the reason it’s called “named perils” is that you’re only covered by the calamities and circumstances explicitly set out on the insurance policy. You have the option to include extra perils like water damage from drainage problems, fire, hail, explosion damage, and the like (again, at additional cost).
Coverage on Multiple Properties – Another great perk from Foremost Insurance is that you can apply a single expanded landlord policy on multiple vacation and short-term rentals that you own and/or manage.
It’s important that you take a good look at what you and your vacation rental property need when you’re looking around for which insurance policy to get. Foremost Insurance offers a great option for those not occupying their short-term rental, especially when you also want several of your properties covered by a single insurance plan.
An augmented homeowners policy like the one offered by Allstate HostAdvantage might work for some, especially those who want to live within the property they’re renting out; or you could be seeking a comprehensive, tailored premium insurance plan like those from Proper Insurance. Whatever it is, make sure you read the specifics so you can relax knowing that your insurance plan has got you covered.