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What is the difference between personal property and building property?

I have a question concerning coverage with a homeowners policy when you rent out your home. What is the difference between personal property and building property coverage? Is it different if I rent my home to someone?

Mar 6, 2023 Chicago, IL

Beth Swanson

Mar 6, 2023


Thank you for reaching out to The Zebra. This is a great question that can go in a few different directions. But first, let's address how these are different. Personal property coverage will provide coverage to any personal belongings in the home. Basically, if you were to take the roof off your house and flip it upside down, everything that would fall out would be considered personal property. This includes things like clothing, dishes, furniture, electronics, refrigerator, etc.

In terms of building property coverage, this is coverage for the structure of your home — the dwelling coverage part of homeowners insurance. For example, if your home burnt down to the foundation this coverage would help to rebuild your home. With building property coverage there's much more that's taken into account to get that finalized number. Insurance companies will look at what the exterior walls of your home are made of, what kind of roof you have, your HVAC system, the types of countertops you have, what your floors are made of, and any other updates that you've made to the structure of the home. All of this (and much more!) information is used to determine how much building coverage you have to rebuild the home you have. 

Next, let's look at the rental aspect of your question. If you're renting your home as a long-term, unfurnished unit, the tenant will want to have their own renters insurance to cover their personal property inside the house. But if you have appliances, for example, that you've left at the house for the tenant to use, you might consider home and contents coverage with your landlord and rental policy. Your dwelling coverage will cover the actual building.

If you're renting your house as a short-term vacation rental, however, there are some different considerations. Standard homeowners insurance doesn't extend to operating a business from the home, as you'd be doing with an Airbnb, VRBO or other vacation rental situation. You should talk to your agent or company about endorsements or home-sharing insurance coverage they may offer. You might also consider a landlord policy in this situation, too.

There can be a lot to consider when renting your home, so be sure you've got the coverage you need and the price that fits your budget. If you're ready to shop around for a new insurer, give our agency a call at 888-444-8949 for a quote personalized to your situation.

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