When Is The Rental Of My House A Business Use So As To Preclude Coverage For Losses?

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Renting property is a good way to make money. However, it is important to appreciate at what point the process is deemed a business move. One homeowner found out too late that they could not claim on fire damage to their rented home, because the homeowner’s did not cover a business rental. The two and a half year lease was made with a friend, but was nonetheless deemed an uncovered business purpose by a federal appeals court, particularly as the length of the stay was such that it could not be deemed an occasional lease such as would occur with vacation rentals.

 

Key Takeaways:

 

    • Be careful when renting your home, because long-term renting could interfere with your insurance policy.

 

    • Insurers can deny coverage because of use of the home as a business, including as a rental.

 

    • Read on to learn about one case in Michigan where their insurance was denied.

 

 

“The insurer maintained the insureds were not using their Michigan home as a private residence, but instead for an uncovered business purpose”

Read more: https://www.propertyinsurancecoveragelaw.com/2020/07/articles/insurance/when-is-the-rental-of-my-house-a-business-use-so-as-to-preclude-coverage-for-losses/

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Image by Shon Flaherty from Pixabay

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