Landlord contents insurance is a type of insurance coverage that compensates a landlord for property loss or damage. Contents insurance usually covers any fixtures, appliances, furnishings on the rental property that belong to you.

In some cases, it may also include outdoor fixtures like fences and garden fittings but every insurer is different so you should always read the fine print just to be sure.

There are two types of contents insurance for landlords. The first is standard insurance; the second is accidental. Landlord contents coverage usually insures the landlord's property in an amount ranging from $10,000 to $50,000.

As a landlord, you may be wondering whether landlord contents insurance is a worthwhile investment. There is no simple answer to this question since every landlord's situation and needs are different. Use the following information to help you decide whether to buy this type of insurance and what kind of coverage is best suited to your needs.

Choose Standard Landlord Contents Insurance if You Want Basic Protection

A standard policy typically protects you from damage caused to furnishings, appliances and fixtures during the normal course of a tenancy. Most landlords do not require this type of coverage for a couple of reasons.

The first reason is because a tenant's security deposit will typically cover any normal wear and tear. And secondly some landlords don't provide home furnishings for tenant use.

On the other hand, if you provide a fully furnished rental property for your tenants, it may be a good idea to purchase this type of coverage. This way any damages to furniture and fixtures can be paid for by your insurer. This coverage usually applies to normal wear and tear only.

Go for Accidental Landlord Contents Insurance if You Want More Protection

In contrast to standard insurance, accidental coverage will pay insurance proceeds for damages that may occur due to tenant negligence and other types of accidents or disasters. For instance, this type of coverage might apply if a tenant rips your sofa when moving out of the property or if a fire out break destroys your furnishings and fixtures.

Most insurance policies will provide coverage in the event of theft or vandalism, tenant negligence, fires, floods, storms, and explosions.

Just to be sure, it's important to read the fine print before purchasing a policy. You will also want to find out whether outdoor structures are covered. For example will you be compensated if your tenant accidentally damages the fence with her car?

Landlord insurance will only cover furnishings that are provided by the landlord. If your tenant wants coverage for his or her own belongings, then they must buy a separate renter's insurance policy.

Should You Purchase Landlord Contents Insurance for Your Rental Property?

In most cases, a standard or comprehensive contents insurance policy is not necessary unless the landlord provides most or all of the furnishings for a tenant.

For unfurnished properties, simply make sure that you collect enough security deposit to cover daily wear and tear. On the other hand, an accidental policy is a good idea to protect your fixtures and appliances in case of accidental damage or natural disaster.  Teo Zhenjie