How Much Does Landlord Insurance Cost in 2025?

The quick answer

‍Most single-family rentals land between $800 and $3,000+ per year. Where you end up depends on rebuild cost, local risk (weather/crime), coverage choices (like loss of rent), deductibles, and upgrades you can document (new roof, leak sensors, alarms). The good news: several of those are within your control.

By knowing your insurance expenses upfront you can budget accuratley and avoid surprise costs if the need rises. In this blog post, we’ll uncover the main factors that drive your premiums, compare different coverage options, and learn smart strategies to help with your rates.

2025 Average Landlord Insurance Costs by State

Here's a table with rough estimates of landlord insurance costs for various states. Remember these are averages, and your actual rate might be different.

Landlord Insurance vs. Homeowners Insurance Cost

Landlord insurance is typically 15% to 25% more expensive than homeowners insurance for the same property. The higher cost of landlord insurance vs homeowners insurance is directly tied to the different risk exposure tied to renting out a home.

So why does landlord insurance cost more than homeowners insurance? 

• Higher Risk of Claims: Tenant-occupied homes see more day-to-day use from people who don’t own the property. That means more chances for small problems to snowball like an unattended drip, a space heater too close to a curtain, a door kicked in during a lockout. Insurers price to that higher frequency of property damage claims.
  
  
• Increased Liability Coverage: You’re responsible for premises liability tied to tenants and their guests. If someone slips on an icy step, trips over a loose railing, or is hurt by a faulty appliance, you could face medical bills and legal costs. Landlord policies carry higher liability limits and broader protections than standard homeowners policies which can increase premium.
  
  
• Loss of Rent Coverage: If a covered event (like fire or a major pipe burst) makes the home unlivable, loss of rent replaces rental income while repairs are made. That safeguard doesn’t exist on a typical homeowners policy and is a key reason landlord coverage costs more but it prevents a cash-flow crunch when you need funds most.
  
  
• Tenant-related wear, tear, and variability: Tenants change, routines change, and usage patterns are less predictable than owner-occupied homes. Accidental damage, neglected issues, or hard use between turns all push expected claims higher. Landlord insurers price in that variability.

What Factors Affect Landlord Insurance Premiums?

Several key factors influence how much you’ll pay for landlord insurance. Keeping these in mind can help you find the right balance between coverage and cost:

1. Property & location risk: Weather patterns (wind/hail/wildfire/coastal), flood zones, local crime.
2. Home age & systems: Older roofs, wiring, or plumbing tend to price higher; documented updates help.
3. Rebuild value (replacement cost): Higher cost to rebuild = higher dwelling limit = higher premium share.
4. Coverage choices & deductibles: Addons like loss of rent, vandalism, or higher liability limits increase price; higher deductibles reduce it.
5. Claims history: Prior claims (property or personal) can influence pricing.
6. Safety features: Monitored alarms, smoke/CO detectors, water leak sensors/shut-offs, storm shutters often earn credits.
7. Rental type & tenant stability: Long-term tenants with solid histories generally price more favorably than short-term/vacation use.

Connecticut Landlord Insurance Example: What Coverage Looks Like in Practice

To better understand how landlord insurance plays out in day to day, let’s look at a a fictional rental property in New Haven, Connecticut. The property is a 2,400-square-foot duplex located near Yale University, fully rented to long-term tenants bringing in $3,200 per month. The home was purchased in 2021 for $610,000, and the owner estimates the replacement cost at around $480,000, or $200 per square foot.

After reviewing several options, the landlord chose a policy from a regional carrier for $1,720 per year, aligning with the typical insurance range in Connecticut.

Here’s how the coverage breaks down. Remember, this is a fictional scenario and every property is extremely unique in its risk and changing market conditions:

• Dwelling: $480,000 limit, $2,000 deductible
  
• Other Structures: $48,000 limit (for fencing, sheds, etc.)
  
• Landlord’s Personal Property: $7,500 limit
  
• Loss of Rental Income: $38,400 limit (roughly 12 months of rent)
  
• Vandalism Coverage: Included, up to dwelling limit
  
• Liability Protection: $1 million
  
• Medical Payments: $5,000
  

Annual Cost Breakdown by Coverage:

• Dwelling Coverage: $1,260
  
• Personal Property: $40
  
• Vandalism Protection: $240
  
• Liability and Medical Payments: $180
  

The largest share of the premium covers the dwelling; that’s because this is the part that would pay to rebuild the structure after a major covered loss like a fire. Meanwhile, personal property and liability coverages are relatively inexpensive since they involve lower risk or payout potential.

Understanding ACV and RCV

When something is damaged, your insurance doesn’t just pick a number—it follows a rule in your policy called the loss settlement. That rule says whether the insurer values the damage at Replacement Cost (RCV) or Actual Cash Value (ACV).

• RCV (Replacement Cost): Pays what it costs today to repair or replace with similar materials. Your deductible still applies.
• ACV (Actual Cash Value): Pays replacement cost minus depreciation (age/wear).

A roof that would cost $30,000 to replace today but is 15 years old might be valued at about $15,000 on ACV. After a $2,000 deductible, you’d net $13,000 and cover the rest yourself. With RCV, you’d get the ACV portion now and the withheld depreciation after repairs (deductible still applies).

The Valuation Takeaway

Even with adequate coverage limits, the valuation method can make or break a claim. In high-value markets like Connecticut, landlords are often better served by paying slightly more for replacement cost coverage to avoid paying thousands out-of-pocket during a loss. Always read the fine print, and don’t assume you’re fully protected just because you have a policy in place.

Protect Your Rental Property With Insurance Built For You

Protect what you’ve built with coverage that fits how you operate. Obie pairs fast quoting with your stored requirements, so limits, endorsements, and valuation methods line up from the start so there are no gaps if you need to file a claim. Clear terms, quick turnaround, and policies that reflect how your rentals actually run. Get your free quote today.

FAQs about Landlord Insurance Cost

How much is landlord insurance for a single-family home?

Landlord insurance for a single-family home typically costs between $800 and $3,000. It depends on the location, property value, coverage limits, and risk factors.

How often do Obie landlord insurance premiums increase?

Landlord insurance premiums from Obie, and most any insurance company for that matter, can increase annually at the time of  policy renewal due to inflation, increased claims in the area, or changes in property value or risk profile.

How to lower landlord insurance premiums?

You can lower premiums by increasing your deductible, bundling with other policies, installing safety features like smoke detectors or security systems, and shopping around for competitive quotes.

Is landlord insurance tax deductible?

Yes. In most cases, landlord insurance premiums are tax-deductible as a business expense if the property is used for rental income. Always consult a tax advisor for your specific situation.