A Guide to Pennsylvania Landlord Insurance
Thinking about buying a rental property in Pennsylvania? While landlord insurance is not required by law in the Keystone State, it’s highly recommended that rental property owners protect themselves and their investment with comprehensive coverage. Here, we explore which factors affect the price of Pennsylvania landlord insurance, which optional insurance policies to consider, and strategies for lowering your premiums.
Pennsylvania real estate market: Pros and cons
As a growing rental market, Pennsylvania — and particularly the Philadelphia and Pittsburgh areas — is becoming a more attractive state for real estate investment.
Pennsylvania landlords won’t pay the high price tags and property taxes of neighboring states like New York and New Jersey. With a robust railroad system and proximity to both the East Coast and Midwest, Pennsylvania offers commuters easy access to New York City, Washington D.C., Detroit, Columbus, and more.
That said, Pennsylvania real estate brings some challenges. The major storm systems of the Midwest and Northeast often move into Pennsylvania to cause severe rain, snow, and hurricanes. This means landlords will spend more time and money on property maintenance and repairs. And with so much history in this state — from Founding Fathers to the industrial steel mills — many of Pennsylvania’s buildings are older, which also requires more upkeep.
Important considerations for Pennsylvania landlord insurance
With the unique risks that Pennsylvania landlords face, purchasing optional endorsements on top of your standard landlord insurance will further protect your investment. Here are some additional coverages and policies to consider:
- Mine subsidence insurance: Rural Pennsylvania landlords ought to be aware of the hazards of owning property in old mining towns. Mine subsidence insurance covers property damage caused by shifting land around man-made mines — and may even be required in certain Pennsylvania zip codes. While it will add to your premium costs, it’s a lot cheaper than paying for a crumbled foundation or sinkhole after a mine shaft caves in. Use the Pennsylvania Department of Environmental Protection’s mapping tool to help determine if your property is located on an abandoned or active mine.
- Flood insurance: Though landlocked, Pennsylvania has a lot of ground water — and flooding is becoming more and more common. It’s important that landlords are prepared with flood coverage, and know whether or not their policy covers general water/sewer backup (included in many standard policies) or natural disaster flooding (usually as an add-on policy). With a partner like Azibo, natural disaster flood insurance is accessible across 51 jurisdictions and covers all types of flooding scenarios, including your basement (as many traditional flood insurance policies don’t cover below ground-level).
- Theft and vandalism coverage: Highly populated areas like Philadelphia and Pittsburgh are prone to higher crime rates — and in turn, property damage. Theft and vandalism coverage doesn’t refer to damage by a tenant, but rather if someone breaks in and damages a window, spray paints the walls, or causes other structural damage.
- Long-term roof damage: Over time, water damage and wind can wear down your roof and affect the safety and stability of their property. A leaky roof or mold caused by damp conditions, for example, is often not covered by a standard landlord insurance policy.
- Loss of rent coverage: Loss of rent coverage is recommended in a state like Pennsylvania that has a higher risk of hurricanes and flooding. When a rental property is severely damaged by a natural disaster, accident, or tenant negligence, it becomes uninhabitable and unable to be rented out. Due to this forced vacancy, landlords will lose their rental income until the property is repaired. But with rent loss coverage, the financial burden of a vacant rental property is less severe as long as the cause of the claim is covered by the policy.
- Umbrella insurance: It’s a good idea to get comprehensive liability coverage in this highly populated, litigious state. Umbrella insurance helps protect you and your assets in two scenarios: if your primary insurance policy (regular homeowners, landlord, auto, or watercraft policy coverage) doesn’t cover you for a specific scenario, or if you get caught up in an expensive lawsuit that exhausts the financial limits of your primary plan.
Tips for lowering your Pennsylvania landlord insurance premium
Your insurance premium depends on a number of factors, including geographic location, property condition, and claims history. You can also reduce your rate by adjusting your desired coverage and deductible. Here are a few tips to help you lower your Pennsylvania property insurance premiums:
1. Consider a higher deductible
In Pennsylvania, you have the option to adjust your standard deductible to lower your topline premium. For this reason, raising your deductible can be a strategic opportunity to lower your premium. That said, be sure you can afford the higher deductible in the event that you need to make a large claim.
2. Require renters insurance for tenants
Another way landlords can better protect themselves and lower premiums is by requiring renters insurance for tenants. While renters insurance is not required by law in Pennsylvania, some landlords may require it on a case-by-case basis. This is an excellent way to set expectations early on, prepare renters for unexpected situations, and protect your investment.
3. Mitigate risk with the appropriate safety features
A great way to prepare for risk and lower your premiums is with a thoughtful safety plan. Prioritizing safety measures means outfitting your property with smoke and carbon monoxide detectors, and installing security and fire alarm systems. It also means regularly conducting inspections to make sure tenants are following the lease terms, like not barbecuing on the roof or smoking in the unit. Some carriers may offer discounts for going the extra mile to prioritize safety. Even if they don’t, it’s a good idea to protect yourself and decrease liability by putting more precautions in place.
4. Relocate strategically
As a rental property owner, you understand the unique pressures of renting your home to tenants — especially if you’re in a higher-risk area for crime or flooding, for example. If you’re considering relocation or are purchasing a property for the first time, opt for a property that’s farther away from water sources and high-crime neighborhoods but still in a desirable destination. By reducing your property’s risks, you can potentially save money on Pennsylvania landlord insurance premiums.
5. Conduct consistent and thorough maintenance
In the historic buildings of Philadelphia as well as homes throughout the state, it’s very important to stay up to date with building and safety codes. It’s your responsibility to know the rules, do regular inspections, and maintain the property to avoid negative repercussions and property damage that could have been prevented. If you don’t live nearby, consider hiring a property manager to help you stay on top of maintenance.
How much insurance do I need for my Pennsylvania investment property?
While some states and zip codes require minimum coverage or specific policies — as do some mortgage lenders — choosing how much landlord insurance to buy is primarily a personal decision. That said, there are some important factors to consider when setting the limits of your personal property and liability coverage in Pennsylvania, including:
- Your property’s unique risks. Are you close to a body of water? In a high-rise building? If so, your property may be more susceptible to damage from wind, water, and other natural perils. Be sure to have coverage in place for these types of perils, and ask your agent to recommend other policies or coverages for more comprehensive protection.
- How much of your personal property is available for tenant use. What personal property of yours can tenants use, and how expensive is this property? This helps determine your personal property limits on a landlord insurance policy.
- Your personal risk tolerance. Are you willing to have a higher deductible for lower premiums? What makes the most financial sense for you?
By answering these questions, you can make a more informed decision about how much coverage makes sense for you and your property.
Partner with a specialized local insurance agent through Azibo
Navigating lengthy property insurance policies is difficult in any state — but especially one like Pennsylvania. Committed to enhancing the landlord experience, Azibo is the only national online commercial insurance producer focused solely on independent landlords.
Landlord insurance typically costs about 20% more than homeowners insurance. According to NerdWallet, the average cost of homeowners insurance in the U.S. is about $1,784 per year. This would put the average landlord premium at approximately $2,141 per year. Yet many Azibo customers pay annual premiums under $1,000 for landlord coverage. We’re proud to provide you with quick access to a curated set of high-quality insurance carriers — so you can get the right coverage, at the right price, for your rental business.
Ready to put insurance headaches in the past? Azibo is here to help. Simplify the Pennsylvania property insurance process and get your free quote today.
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Disclaimer: The information provided in this post does not, and is not intended to, constitute insurance advice; instead, all information, content, and materials are for general informational purposes only. This content may not constitute the most up-to-date insurance information. Readers must contact a licensed insurance agent or company to obtain quotes, advice, and guidance with respect to any insurance matter. No reader, user, or browser of this article should act or refrain from acting on the basis of information herein without first seeking the advice of a licensed insurance producer.