Have you ever experienced a natural disaster or seen footage of one? Trees uprooted and planted in rooftops, charred home sites after a wildfire or perhaps the water-mark for a recent flood that reaches 6ft on a living room wall.

What if something like this happened to one of your investment properties or real estate rentals? Would you be covered by your Home-Owner’s Insurance Policy? Maybe….

Here is a Guide to Disaster Related Insurance Coverage For Real Estate Investors:

Wind  & Hail

If you live in an area prone to hurricanes or hailstorms your standard policy may only offer very limited coverage.  Most standard polices cover wind and hail damage to your property’s main structure.  Typically broken window’s and roof damage are covered. But did you know the carpet or property effected by that roof leak or broken window may not be covered?  Talk to your insurance agent about making sure your all of your needs and liabilities are covered.

Many areas or “high-risk” weather zone areas often require real estate investors to buy special additional coverage. Be sure that you check this out because it will impact your holding costs or effect your rental property cash flow.


I just checked my own real properties insurance policies and they all cover fire damage. But did you know if your apartment complex or duplex gets burnt to a crisp and you are covered 100% you many still owe thousands of dollars of your own money to the construction company?  Check to see if your covered for “today’s” rebuilding costs or that all upgrades and additions are accounted for. Oh yeah, don’t forget “loss of income” coverage for your cash flow properties.


This one is sometimes a requirement by mortgage lenders. Shockingly, most home or property casualty insurance carriers do not write flood insurance. You must buy coverage through the National Flood Insurance Program (NFIP). This program works with all of the various companies that provide local and regional coverage. Generally your NFIP insurance policy will cover your investment property damage only in specific scenarios. Floodsmart.gov is the website for investors to go to for more flood and insurance carrier related information.

The point is you would not drive out of your garage without being insured, so why leave your investment properties exposed to risk needlessly?

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