Texas landlord home insurance is different from a standard homeowner’s policy in several ways. Because of this a landlord will usually get a specialized type of homeowners insurance. This is sometimes called a dwelling policy.
Personal property (contents) is not usually standard with a landlord home policy. There is often an option to get this at extra cost. That is a good idea if the home is furnished with appliances and or furniture. You will probably be able to select the dollar amount of this coverage that you want. Personal property theft is normally excluded from coverage.
Personal liability and medical payments to others coverage will probably by optional with a landlord’s home insurance policy. There will probably be an option to have liability coverage added with extra cost. This is usually inexpensive and I recommend getting liability coverage.
Texas has standardized packages of coverage and most landlords get a Texas Dwelling Policy (TDP1, TDP2, or TDP3 package.) TDP1 is the least expensive and covers basic risks. TDP2 covers some additional perils including rupture or bursting of water pipes, fall of trees, glass breakage, and collapse of building. TDP3 includes TDP2 plus trees, shrubs, plants, special form (broader coverage) on the building, and additional living expenses. (Please note that your actual policy may vary from my description and you should ask your agent to explain all details of any policy that you get)
In many cases I suggest the TDP3 policy because it has better coverage for only slightly more than a TDP1 plan. Then ask about your options to upgrade by adding things like some content coverage, personal liability, and medical payments to others coverage.
Your agent should discuss all available discounts with you. This can include things like an alarm system, newer home, updated electrical or plumbing, claims free, good credit, and senior citizen discounts.
Flood coverage will not be included with your policy. If you are in a high risk area this is essential. If the home is not at high risk the cost will be very low. I usually suggest getting at least some flood coverage.
Another consideration for landlords is a renter’s insurance package for the tenants. This is important for them and you. You want their property to be covered to reduce the possibility of a claim against you if they have a loss. For example, if there is a fire and they have $50,000 in property destroyed, they might claim it was your fault because the home had an issue with the electrical system. You could also have exposure for a liability claim in the event of an injury. I suggest requiring the tennant to have a high level of liability coverage. A renter’s package policy is usually inexpensive and is typically in the $100 to $300 per year range. Consider making renters insurance a requirement in your lease. You may want to require proof of a 1 year paid-up policy at move in time. Ask your agent to advise you about how much coverage is sufficient.
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