What’s the Difference Between Landlord Insurance and Homeowners Insurance?

If you own a property, you need insurance. But the right kind of insurance depends on how you use the property. If you live in the home yourself, standard homeowners insurance may be enough. If you rent it out to someone else, even part-time, landlord insurance becomes essential. The difference is not just about labels, but about how each policy responds to risk.

This becomes especially relevant when you’re transitioning a property from personal use to rental. You might think about this the next time you move to a new home and keep your old one as an investment.

Core Purpose of Each Policy

Homeowners Insurance
Covers the physical home, your belongings, and your personal liability when you live in the property.

Landlord Insurance
Covers the building, rental income loss, and your liability as a property owner when someone else is living in the home.

What’s Included: A Side-by-Side Look

Feature	Homeowners Insurance	Landlord Insurance
Who lives in the property	You or your family	Your tenant
Coverage for personal belongings	Yes	No (unless you furnish the rental)
Liability for injuries	Personal use liability	Property owner liability
Loss of rental income	Not included	Included if damage makes unit unlivable
Tenant-caused damage	Not covered	Optional add-on available

Tip: Furnished rental units may benefit from limited contents coverage, but this typically requires a specific endorsement.

Why the Right Coverage Matters

Using homeowners insurance for a rental property is not only risky, it may void your policy. Insurers base premiums and coverage on how the home is used. If you fail to disclose that tenants are living there, a claim could be denied even for legitimate damage like a kitchen fire or broken water pipe. Landlord policies, on the other hand, are priced for the additional risks of having renters. These policies include specific protections for lost rent, legal liability from tenant injuries, and more robust structural damage coverage.

Tailoring Your Policy to the Property

It’s also worth noting that landlord insurance can be customized depending on the type of property you’re renting out. A single-family home carries different risks than a condo, duplex, or short-term vacation rental. The number of units, the length of leases, and whether utilities are shared all influence the level of protection you may need. Speaking with your insurer about how the rental operates helps tailor the policy to your exact situation.

Caution: Many landlords assume that a vacant or short-term rental can be covered by their existing homeowners policy. Always contact your insurer before listing your property to avoid unintentional gaps in coverage.