Best Landlord Insurance in Illinois
- Best Landlord Insurance in Illinois
On top of the everyday concerns of being a landlord in Illinois, you don’t also want to worry about unexpected property damage. Landlord insurance, also known as rental property insurance, protects your property and liability. If you ever file a claim, the right policy can save you thousands or hundreds of thousands of dollars.
We created this comprehensive guide to help you find the best Illinois landlord insurance plan for you. Keep reading to learn about common coverages, average costs, and much more.
How Much Is Landlord Insurance in Illinois?
Average landlord insurance rates in Illinois are about $1,914 per year for a $200,000 house, $2,663 per year for a $300,000 home, and $2,976 for a $400,000 home.
For reference, these Illinois landlord rates are slightly higher than nearby states. Michigan’s average rates are about $100 lower for the same properties, while Iowa’s are about $200 lower yearly for the same properties.
Most websites report that landlord premiums are about 15% to 25% higher than homeowners insurance premiums on corresponding houses. We can calculate average landlord insurance rates for properties at various price levels using these findings and the numbers on our Illinois homeowners insurance page. Look at the table below.
Average Cost of Landlord Insurance in Illinois
Cost of House
As you can see, landlord insurance rates in Illinois increase as the amount of coverage needed increases, which is common. Generally, larger, more expensive properties will need more insurance coverage. For instance, a single apartment unit will likely have much lower premiums than a duplex or quadplex in the same location.
What Does Landlord Insurance in Illinois Cover?
Landlord insurance policies are officially known as dwelling fire policies (DPs). Landlord insurance policies can cover several types of rental properties, such as:
- Single-family dwellings
- Multi-family dwellings (duplex, fourplex, etc.)
When getting a dwelling policy, you can choose from a handful of coverages to protect yourself and your rental property. They are as follows.
Dwelling coverage financially protects the structure of your rental and its permanently attached fixtures. This includes the roof, flooring, walls, countertops, porches, piping, air conditioner, and more. Every landlord insurance policy will have dwelling coverage.
Other structures coverage safeguards features on your rental property not attached to the main house. These include sheds, fences, carports, gazebos, detached garages, and more. You don’t need this coverage if your rental property has no other structures.
Personal Belongings Coverage
Personal property coverage in landlord insurance plans covers items you keep at the rental property for its maintenance or upkeep. These commonly include lawn equipment, snowblowers, or tools. This doesn’t cover your tenant’s property.
Landlord Liability Coverage
Landlord liability coverage protects you if you’re found liable for a tenant’s or guest’s injury on your property. If the injured party pursues you for damages, your liability coverage can cover medical expenses and legal fees.
Loss of Income Coverage
Loss of rental income coverage kicks in if tenants are forced to move out after a covered loss. While your insurer repairs your house for tenants to move in again, they can cover the rent payments you miss out on.
You’ve worked hard to buy your rental property. Protect it with a custom policy at an affordable price.
Types of Landlord Insurance in Illinois
Not every rental insurance property will include all the coverages listed above. Landlord policies are highly customizable due to the potential differences in every landlord situation. You can get one of three policies to cover your rental property.
DP-1 Insurance Policy in Illinois
DP-1 insurance policies are the most basic form of protection you can get. They cover the fewest potential sources of damage. They cover wind and fire damage but provide no protection against theft, vandalism, water damage, and more. DP-1s also usually exclude liability coverage.
DP-2 Insurance Policy in Illinois
DP-2 insurance plans protect against a few more damage sources, known as perils. The most notable are theft, vandalism, freezing pipes, and snow damage. DP-2 policies also cover losses at replacement cost, while DP-1s only cover your property at actual cash value, lowering your payout.
DP-3 Insurance Policy in Illinois
DP-3 insurance in Illinois is the most protective of the policies, although it often has the most writing restrictions. It covers the most perils at replacement cost and usually includes liability coverage. But, it may only be available on certain properties, such as traditional homes that meet age and building requirements.
How to Get the Best Illinois Landlord Insurance
To get the best landlord insurance in Illinois, you need to understand the coverage needs of your rental property. Once you know how much insurance you need, you should get quotes to find the best policy that fits your budget.
You can modify rental property insurance plans a lot to fit your needs. For instance, if you don’t have any personal property or other structures at your rental, you can eliminate these coverages from your desired policy., which would lower your premiums.
Coverage needs can change as your property changes. For instance, a DP-1 or DP-2 may suffice if your rental is currently vacant or unoccupied. But, if construction crews visit the house daily for renovations before tenants move in, you should consider adding liability coverage to your policy. And after they finish the renovations, you should update your dwelling coverage amount to reflect the increase in replacement cost. You may also want to change to a DP-3 when tenants move in.
You can also add endorsements to your policy if they interest you. You can add inflation guards or ordinance or law coverage to cover potentially increased future rebuild costs. You can also add coverages like water backup to cover sump pump issues. These cost extra, but they raise average landlord insurance in Illinois to the next level.
What Companies Have the Cheapest Landlord Insurance in Illinois?
According to our findings, Allstate, State Farm, and USAA have some of the cheapest landlord insurance in Illinois. These are well-known, nationwide companies experienced in home insurance.
When getting quotes, you should also check the rates of smaller, regional carriers that may have more local expertise or more personalized customer service. Below, we broke down the average rates of some popular landlord insurance companies in Illinois.
Average Landlord Insurance Cost in Illinois for a $300,000 House
Finding relatively cheap landlord insurance in Illinois should always be possible, even if it’s from one of the more expensive carriers on this list. You won’t know your exact rate until you get a quote. One provider may be cheaper in your area or a better option for you than another.
Getting Landlord Insurance in Chicago
Chicago is the largest city in Illinois and the third-largest in the country. It’s a commercial and metropolitan hub, with millions of tourists and state residents flocking into the city yearly. Owning a rental property in Chicago can be very lucrative, which is why it’s essential to have landlord insurance in Chicago.
Landlord insurance in Chicago protects your rental from disasters and accidents you can’t control that can remove your tenants and damage your property. Without the right coverage, you could pay thousands or tens of thousands out of pocket to repair your property.
Getting the right rental property insurance in Chicago starts with recognizing how much coverage you need. Then, you should compare policies. Costs will vary based on your location in the city and the kind of property you want to insure.
For instance, rental property insurance on a single-family home in Lincoln Park may be more expensive than insurance on an apartment in the suburbs. High-crime areas may also have higher landlord premiums.
When getting quotes, you can start with some of the carriers we named above, but broadening your net is always a good practice. Ask friends, families, or neighbors for suggestions. You can also read company reviews online.
You’ve worked hard to buy your rental property. Protect it with a custom policy at an affordable price.
What Affects the Cost of Rental Property Insurance in Illinois?
Several factors affect the cost of rental property insurance. Insurers analyze many variables to determine cost-effectiveness when giving someone a policy. A company wouldn’t survive if it lost money on every policy due to claim payouts.
Some of the most important considerations when deciding your premium are:
- Property age
- Property features
- Claims history
A property’s location is vital to rates. Insurers will look at property insurance claims in your area. If you live in a flood zone, high-crime zone, tornado-prone area, or another area subject to a certain kind of damage, you may pay higher premiums for rental property insurance in Illinois to offset your risk.
Building age influences premiums, too. Older dwellings can have many more issues leading to claims, such as leaky roofs, rusted pipes, and failing air conditioners. Newly constructed homes built to the latest codes have lower rates.
Certain features on your property can raise premiums, such as pools, trampolines, and wood stoves. Some features are “attractive nuisances” that increase your liability risk. Other elements just make your home more dangerous. Also, having more valuable fixtures or items at your rental will raise the amount of insurance you need to fully cover these things, thus raising premiums.
Is Landlord Insurance Required in Illinois?
Landlord insurance in Illinois isn’t required by law, but mortgage lenders will mandate insurance on rental properties with loans to protect their financial investments.
When giving a mortgage, lenders will always require insurance coverage on whatever property is getting the loan. That way, if the building gets destroyed, the lender can recoup the money they’re putting down from the insurance company.
Many residential landlords have mortgages, either on the property they live on with tenants, or on a second or vacation home they may rent out. Homeowners insurance won’t sufficiently cover you in these scenarios. You’d need landlord insurance for a rental property in Illinois.
Landlords who own rentals through trusts, LLCs, or other business identities need commercial insurance, which is a different type of coverage.
How to Get Illinois Rental Property Insurance Quotes
Comparing quotes from several providers is essential when looking to buy rental property insurance. We tried to make getting Illinois landlord insurance quotes easy with our online tool. You can see policies from the top insurance companies in your area, and you may be able to bind entirely online.
Covered was built to simplify insurance. If you need help with your Illinois landlord insurance quote or would rather bind with one of our licensed agents, please call us at 833-255-4117 during business hours. You can also email us anytime at email@example.com.
You've worked hard to buy your rental property. Protect it with a custom policy at an affordable price.
The editorial content on Clovered’s website is meant to be informational material and should not be considered legal advice.