Best Landlord Insurance in Maryland
- Best Landlord Insurance in Maryland
Between maintaining your rental property and dealing with tenants, being a landlord can be stressful. The last thing you need is unexpected property damage in the form of theft, natural disaster, or another incident ruining your property and eliminating your rental income.
Having the right landlord insurance in Maryland can give you peace of mind. Use this guide for help in finding the right coverage. We go over average premiums, cost factors, and more.
How Much Is Maryland Landlord Insurance?
The average cost of landlord insurance in Maryland is about $1,399 per year for a $200,000 house, $1,942 for a $300,000 home, and $2,294 per year for a $400,000 house.
Compared to nearby states, these landlord insurance rates in Maryland are slightly higher than Virginia’s and about $200 to $300 higher per coverage level than Pennsylvania’s.
It’s commonly reported that landlord insurance premiums are 15% to 25% higher than homeowners’ premiums on the same properties. With this in mind, we calculated Maryland landlord insurance costs based on a few different common coverage levels.
Average Cost of Landlord Insurance in Maryland
Cost of House
The cost of your insurance will increase as your home value increases. Larger properties have more square footage and often more tenants, so they need more coverage to protect them. Many more factors influence the landlord insurance rates in Maryland that we’ll go over in-depth a little later on.
What Does Landlord Insurance in Maryland Cover?
Landlord insurance, also known as rental property insurance, can cover a few different types of rental properties. The most common ones are:
- Single-family dwellings
- Multi-family dwellings (duplex, fourplex, etc.)
The average landlord insurance in Maryland can contain the following coverages:
Dwelling coverage protects your rental property’s physical components and permanently attached fixtures. This includes your roof, walls, flooring, countertops, balconies, and more. Every landlord insurance plan has dwelling coverage.
Other structures coverage covers the features on your property that aren’t attached to the main dwelling. These can include carports, sheds, fences, detached garages, and more.
Personal Belongings Coverage
Personal property coverage in a landlord policy covers any of your belongings you keep at your rental for maintenance reasons. Typical examples are lawn equipment or tools, but if you don’t keep anything at your rental, you might not need this coverage.
Landlord Liability Coverage
Landlord liability coverage kicks in if your tenant or guest gets hurt on your property and pursues you for damages. If you’re found liable, your liability coverage can pay medical bills and legal fees.
Loss of Income Coverage
Loss of rental income coverage applies if your tenants get forced to move out after your property sustains major damage and is unlivable. While your insurer makes repairs, they can cover the rent payments you’re missing out on through loss of rent coverage.
Types of Landlord Insurance in Maryland
Just as many landlord situations vary, potential landlord insurance options vary. You can choose from three policies that include combinations of the above coverages.
DP-1 Insurance Policy in Maryland
A DP-1 insurance plan is the cheapest and most basic option for landlord insurance in Maryland. DP-1s exclude liability and personal property coverage, and they cover losses at actual cash value. Actual cash value means your insurer will deduct depreciation when reimbursing you during a claim, which means you won’t get the full cost back of anything damaged.
DP-2 Insurance Policy in Maryland
DP-2 policies cover more potential sources of damage, called perils, than DP-1s. DP-2 policies cover theft, vandalism, water damage, and more on top of the wind and fire damage that DP-1s cover. They may also exclude liability coverage by default, but you might be able to add it at an extra cost depending on your carrier.
DP-3 Insurance Policy in Maryland
DP-3 policies offer the most protection. They often include liability and personal property coverage by default. They protect from the largest number of perils, and they cover your property at replacement cost. As a result, DP-3s are the most costly option.
How to Get the Best Rental Property Insurance in Maryland
The best Maryland landlord insurance policy will differ for every landlord. Choosing the right one requires an understanding of your specific budget and coverage needs. Once you have an idea of what you need, you should shop around to find the best deal.
Maryland has over 140 homeowners insurance companies, many of which also write rental property policies. You should be able to find one that satisfies your needs without draining your pockets. Thankfully, landlord insurance plans are highly customizable, so you can comfortably eliminate some coverages to save money depending on your situation.
For instance, you can drop other structures and personal property coverage if you don’t have either at your rental. You may also be comfortable foregoing liability coverage if you don’t currently have tenants.
But, be sure to stay on top of your policy throughout the year. You can add coverages if your risk profile changes. For example, you should increase your dwelling coverage limits if you renovate your rental property, which increases its value.
You can also add optional endorsements for an extra fee for more complete protection. Some carriers offer extended replacement cost coverage, identity theft coverage, water backup coverage, and much more.
Companies With the Cheapest Landlord Insurance in Maryland
Based on our analysis, State Farm and Nationwide have some of the cheapest landlord insurance in Maryland. We calculated average premiums for Maryland rental property owners for coverage on a $300,000 home.
As you’ll see, coverage from these five companies alone differed up to $750 for $250,000 of coverage and up to $2,051 for $300,000 of coverage. From this small sample size alone, you can see why comparing rates from several carriers is important to find cheap rental property insurance in Maryland.
Average Maryland Landlord Insurance Cost
Your premium will vary based on a few factors. For instance, you’ll likely pay less than the figures in the table if you have a smaller unit you’re renting out.
Maryland Landlord Insurance Cost Factors
Insurance companies analyze several facets of you and your property before giving you a policy to determine your premium. This process, called underwriting, is essential for insurance companies to survive as businesses.
While each carrier has a slightly different way of underwriting, the most critical variables remain the same. Insurers will always look at your:
- Property age
- Property features
- Property location
- Claims history
Rental property insurance companies in Maryland need to know when your property was built. Older homes may have more issues that can lead to claims thanks to wear and tear. Exceptionally old properties may not be able to qualify for DP-3 policies.
Companies may also ask about the age of certain features, like your roof and HVAC systems. Homes with older roofs are more susceptible to wind damage, especially on the Atlantic coast in Maryland, where the risk of hurricane and tropical storm damage is higher.
You may pay higher premiums near the coast, but insurers are wary of other areas, such as high-crime and flood zones, that can spawn claims. Houses in these places may pay more for coverage.
Providers will also ask you about your claims history. You’ll likely have higher Maryland landlord insurance costs if you’ve filed a claim in the past three to six years because carriers believe someone who has filed a claim is more likely to file another than someone who never has. This makes you a greater financial risk.
Is Landlord Insurance Required in Maryland?
No law requires landlord insurance in Maryland, but mortgage lenders typically require property coverage as part of their home loans. If you purchased your rental property with a mortgage, you’ll need landlord insurance.
Since lenders put most of the money down on your house, they want to protect their investment with insurance. They require you to keep your coverage for the life of your loan. If you don’t keep your policy, your lender will force-place coverage on you.
Force-placed insurance is more expensive and less comprehensive than the coverage you can acquire on your own. Avoid it by paying your premiums on time and getting the right policy for you.
How to Get Maryland Rental Property Insurance Quotes
The purpose of getting multiple Maryland landlord insurance quotes when shopping for coverage is to guarantee you’re finding the best deal. At Clovered, we take pride in helping people find the insurance they need at the price they want.
As an independent insurance agency, you can use our online quoting platform to compare Maryland rental property insurance quotes from some of the top providers in your area.
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.