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Does anyone know of any insurance company that will issue a landlord's policy when a one family house has multiple units?
If I understand the question correctly, you are looking for an insurance company that will insure an illegal residence - never heard of a reputable insurer who knowingly does that.
WARNING: its not only illegal apartments that can not get a penny if a tenant torches your place or steals your stuff.
ITS ALL RENTALS where folks make the mistake of covering them under their standard h03 homeowners insurance .
you can not use homeowners insurance to cover your rentals ,even if legal two families . you need special landlord insurance.
why?
because standard homeowners is for owner occupied only. under most state laws anyone living in your home more than x amount of hours is considered a household member under homeowners insurance.
your policy covers you ,your family,HOUSEHOLD members and pets .
if your tenant burns down your place intentionally or steals all your stuff its the same as an insurance job and your not going to be covered.
we let a friend stay with us for a few weeks when he moved to ny and got a new job until he found an apartment. we didnt know he was now a druggie and he ended up burglarizing us.
geico wasnt going to cover the claim since he was considered an insured under our policy and it was therefore an insured stealing his own stuff.
even the police said it was a civil matter to determine whos stuff it really was. maybe i told him he could have the tv ,stereo and computer and now want it back?
most landlords never even heard of landlord insurance until its to late. most claims fly under the radar with standard homeowners and arent an issue until you run into theft ,arson or liability issues.
landlord insurance breaks the link between a tenant being classified as a household member, homeowners insurance does not.
its a rude awakening to find out by having only homeowners insurance that your disgruntled tenant who intentionally torched or flooded your rental is considered a household member.
read your policy. note how it says "for owner occupied and then look to see who else is considered an insured . you will see those words household member .
as usual folks its rarely what we know that gets us in trouble,its what we know that aint so that does.
Last edited by mathjak107; 06-17-2012 at 03:10 AM..
Very interesting thread. Can someone tell me what a "mother daughter" apartment is? Not certain of the exact terminology.
Often a Hi-Ranch, it's a one-family house with a permit for a second kitchen, an additional bathroom and bedroom (possibly plus living room) for an immediate family member, as in parents living with children. Not to be confused with an accessory apartment (permit has to be renewed each year and apartment re-inspected), which can be rented out to strangers, as long as the owner also occupies the house.
Is the layout and features the same, just different types of permits required? I know someone who has their mother living with them, and the apartment is so beautiful for her, but I don't see the difference from a regular apartment. She has an exterior egress door of her own, as well as an interior door to the main home, and the accessibility could vary according to the locksets installed. If they sell their home, I wonder if that apartment could be used as a regular legal apartment.
Is the layout and features the same, just different types of permits required? I know someone who has their mother living with them, and the apartment is so beautiful for her, but I don't see the difference from a regular apartment. She has an exterior egress door of her own, as well as an interior door to the main home, and the accessibility could vary according to the locksets installed.
If they sell their home, I wonder if that apartment could be used as a regular legal apartment.
Yes to the first part.
Maybe to the second part. They would have to go through the normal accessory apartment permit/inspection routine.
We have no renters and have a "kitchen" in the basement that we've not touched. The stove isn't even connected and I don't think the microwave timer even works. The sink is used for drainage from the dehumidifier and that's about it. If my insurance doesn't cover any accidents, I would be beyond pissed. I'm gonna have to ask about this as if we're about to put one in...
At one point we moved the stove away so the inspector wouldn't consider it a working kitchen. But if we stow it away in another part of the basement and an accident occurs, they probably won't care that the stove was in the other end of the basement... they could assume it was blown over there in an explosion.
The other question - if I did have a permit for a kitchen in the basement, my insurance only then needs to cover this? Doesn't sound like they should be related.
I would be afraid to ask the insurance agent "if" they would cover accident or fire that began in an apartment-like setting with a kitchen, caused by an overnight visitor, or family from abroad, or imagine an elderly parent staying with you. What if they decide to amend coverage or cancel, has that ever happened? And reading the fine print, missing something, maybe it would be a good question for a lawyer...
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