We recommend that our owners carry certain types of insurance coverage so they can maximize their investment property’s value.

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One of the questions we get asked a lot by our owners is, “How much insurance should we carry on our home while we don’t live in it?” Today I want to delve into this topic to give you an idea of what owners and tenants can expect.

The first thing you must do as an owner is notify your current insurance company that you’re not using the property as your primary residence. This is an important detail for insurance companies because that makes the property an investment property.

After that’s done, we first recommend you take out a renter’s insurance policy that covers at least $10,000 in personal property. This is primarily to cover your appliances. This sum won’t be enough to cover a disaster like a wind storm blowing off your roof, but we’ve been fortunate enough in Hawaii to mostly avoid hurricanes and other storms capable of that kind of damage in the past 100 years. Your liability coverage will be $100,000, which is in place in case an accident happens on the property.

The other thing we recommend for owners is to get loss of rent coverage. This is important because if there’s a leak or your home incurs some type of water damage, the tenants probably won’t be able to reside in it and pay rent. The loss of rent coverage makes sure you are compensated for the lost rent on your investment.


What do we ask on the tenant’s side? We require all tenants to carry a renter’s policy, which is a simple renter’s policy to cover a minimum of $10,000 on their property, $50,000 in liability, and more if they have a dangerous pet. If they happen to have what we consider a dangerous pet, we ask them to cover $100,000. We also ask them to have loss of rent coverage in their policy so that policy will kick in if something happens to them and prevents them from paying rent.

If your house has wood floors and experiences a water leak and the tenants can still live there but aren’t happy about it, the tenant’s coverage will take care of what they can cover, and the owner’s coverage will take care of the rest. We often see this situation happen with condos and townhouses.

Depending on the insurance company, this will cost an owner anywhere from $100 to $300 and a tenant anywhere from $100 to $200. It’s a minimal cost, and we require it of both our tenants before they move in and our owners before they have a tenant reside in their unit.

If you have any questions about this topic, please feel free to reach out to us. We look forward to hearing from you!