landlord insurance deductibles and coverage limits

Most landlord coverages include a deductible, and all coverages are subject to limits. If you need to file a claim, you’ll want to know what these terms mean and how they come into play.

When you file a landlord claim for a covered loss, you may be responsible for paying your deductible. A deductible is a set amount used to repair or replace whatever is damaged or stolen.

For example, someone accidentally starts a fire in the rental property and burns the walls, causing $5,000 worth of damage. As the landlord, if you have a $500 deductible, you are responsible for paying that amount, while your insurance pays the remaining $4,500.

Not all coverages will have a deductible, but one will always apply to dwelling and other structures coverages. Your policy declarations will show the amount of your deductible. In most cases, you can choose the deductible from a range of options. A higher deductible usually means a lower premium.

Your coverage limit is the maximum amount Allstate will reimburse you for a covered loss. Each coverage in your landlord policy comes with a limit, but you can set your coverage limits when you buy a policy.

It’s important to understand how much your rental property is worth and how much rental income you make so you can choose appropriate coverage limits. Your limits are listed in your policy declarations. Your local Allstate agent can help you choose or adjust your limits to fit your needs.

Allstate^® Landlords Package Policy offers two ways to settle covered losses:

Actual cash value may be lower than the cost to repair or replace your damaged rental dwelling since losses settled on an actual cash value basis may be deducted for depreciation. You may be required to purchase this policy based on your rental property’s age and condition.

Building structure reimbursement typically means your dwelling is covered for more than the actual cash value—up to your policy limits—if you repair or replace the damaged property within the required time period. But this means your rental property must meet age and condition requirements for eligibility.

Here’s how this reimbursement policy works:

• You receive a check for the actual cash value for the damage to the rental property up to the policy limits.
• If you repair or replace the property within the required time period, you’ll receive a separate check for the remaining amount needed to make the repairs or replacement, up to your policy limits.

Special payment in the instance when the loss to the rental dwelling is paid out without deducting the depreciation, is less than $1,500 and the property is not excluded from the building structure reimbursement provision.

If you have an Allstate Landlords Package Policy, review your coverage, limits and deductible on your policy declarations.