Landlord Insurance in Michigan: A Must for Property Owners
Landlord insurance in Michigan is highly recommended if you own rental property in the Mitten State—whether it’s a classic Detroit duplex, a vacation home in Traverse City, or a student rental near the University of Michigan.
Homeowners insurance typically won’t cover claims for a property you’re renting to others. A landlord insurance policy is essential to protect your rental property from risks like damage, liability, and lost rental income, ensuring your investment remains safeguarded.
Key takeaways
- Standard home insurance doesn’t cover rental properties. If you’re renting out property in Michigan, landlord insurance is necessary to ensure proper coverage.
- Landlord insurance generally protects against a range of risks, including property damage from storms, tenant lawsuits, personal belongings left at the property, and loss of rental income.
- Comparing quotes and customizing your policy with add-ons could help you get the best Michigan landlord insurance coverage, tailored to your needs, at an affordable price.
Is landlord insurance required in Michigan?
No, landlord insurance in Michigan isn’t required by state law, but that doesn’t mean you should skip it. If your rental has a mortgage, your lender will almost certainly require you to carry a policy. And if you’ve hired a property management company to maintain your rental, they may require it, too.
Even if it’s not required, landlord insurance is highly recommended. Michigan’s weather can be unpredictable. The state has had 60 confirmed weather disasters in the past 44 years that have each created over $1 billion in losses, according to the National Centers for Environmental Information (NCEI).
In the past five years, the state has averaged 4.4 major weather events per year. Harsh winters, spring floods, and even tornadoes in some regions can cause major damage to your rental property, and without the right coverage, you’d be on the hook for repair costs.
Tenant-related risks are another reason to carry landlord insurance. If a tenant sues you for faulty property conditions, your policy could help cover legal fees, medical bills, and settlements. Regular homeowners insurance in Michigan usually won’t protect you if your property is used as a rental.
How much is landlord insurance in Michigan?
Michiganders can expect to pay around 25% more for landlord insurance than they would for home insurance on the same property. Since the average home insurance policy costs $2,607 per year, according to Insurance.com, this means the average landlord insurance policy is around $3,259.
That said, the cost of landlord insurance in Michigan varies depending on your property’s location, age, and size, as well as the coverage options you choose.
Here’s a breakdown of how much landlord insurance costs in a few Michigan cities so you can see how rates vary by region:
Detroit landlord insurance costs
Detroit has some of the highest costs for rental property insurance in Michigan. The average landlord policy is typically around $3,711 annually. Premiums here tend to be higher due to urban crime rates and older housing stock, which may require more maintenance or updates to meet modern building codes.
Grand Rapids landlord insurance costs
Landlords in Grand Rapids generally pay around $3,195 annually for landlord insurance. That said, weather-related risks like winter storms and hail damage can drive up costs.
Lansing landlord insurance costs
In Lansing, the capital of Michigan, landlord insurance is typically around $3,164 per year on average. This city’s diverse rental market—ranging from student housing near Michigan State University to suburban single-family homes—can affect rates.
Flint landlord insurance costs
In Flint, landlords typically pay around $2,956 annually for landlord insurance. Rates here can be higher due to crime rates and the condition of older properties.
Types of Michigan landlord insurance coverage
Whether you own a duplex in Ann Arbor or a vacation rental in the Upper Peninsula, it’s important to choose the right Michigan landlord insurance coverage options for your property.
Here’s an overview of what you’ll find in a typical policy:
- Property damage coverage
This coverage protects the physical structure of your rental property from damage caused by common risks like fire, windstorms, hail, vandalism, or frozen pipes during Michigan’s harsh winters.
For example, if a heavy snowstorm causes a tree to fall on your rental home’s roof, property damage coverage could help pay for repairs. It typically includes:
- Dwelling coverage for the home’s structure (walls, roof, foundation).
- Other structures coverage for garages, fences, or sheds on the property.
💡 Michigan tip: If you own an older rental property in a historic district, consider adding building code coverage to help cover the cost of updating the property to meet current safety codes after a covered loss.
- Liability coverage
If a tenant or visitor gets hurt on your rental property, liability coverage could help protect you from lawsuits. This includes:
- Medical bills if someone is injured on your property.
- Legal fees and settlements if a tenant sues you.
For instance, if a tenant sues you for unsafe living conditions like mold, lead paint, or bad wiring, liability coverage could help cover any legal claims.
- Loss of rental income coverage
If your rental property needs extensive repairs before a tenant can return, this coverage reimburses you for the rental income you lose during repairs.
For example, if a winter storm causes several pipes to burst in your Traverse City rental home and your tenants have to move out for a month, loss of rental income coverage could compensate you for the rent you would’ve received during that time.
- Landlord contents coverage
If you rent out a furnished unit or keep maintenance equipment like snow blowers or lawnmowers at the property, landlord contents coverage could help pay for repairs or replacements if those items are damaged by a covered event.
💡 Michigan tip: In Michigan’s lakefront communities, many landlords rent out vacation homes. If you provide items like kayaks, bikes, or outdoor furniture as part of the rental, be sure to check if your policy covers those items.
Michigan landlord insurance coverage exclusions
Landlord insurance in Michigan covers a lot, but there are some important gaps to be aware of. Here’s what most standard policies don’t include:
- Flood damage. Properties near the Detroit River, Lake Michigan, or other flood-prone areas aren't protected against water damage from rising waters. You’ll want to consider separate flood insurance if you own rentals near the Great Lakes.
- Tenant belongings. Your policy won’t cover your tenant’s personal items. Encourage tenants to get renters insurance to protect their belongings. In Michigan, it is legal to require tenants to carry renters insurance as part of their lease agreement.
- Maintenance issues. Routine upkeep, like fixing leaky faucets, replacing appliances, or repairing an aging roof, is the landlord’s responsibility and won’t be covered by insurance.
- Intentional damage by tenants. Most policies exclude vandalism caused by tenants, but you can add extra coverage if you’re concerned about rowdy renters.
How to lower your Michigan landlord insurance premium
Looking to reduce your Michigan landlord insurance premium? Here are practical ways which could help lower your costs without sacrificing coverage:
- Compare insurance quotes. Getting at least three quotes can help you find the most competitive rate for your rental property in Michigan. Rates may differ widely between urban areas like Detroit and small towns in the Upper Peninsula.
- Raise your deductible. It's always a good idea to set aside savings for rental repairs and emergencies. If this buffer is big enough, choosing a higher deductible could offset your month-to-month costs.
- Make your property safer. Insurance companies reward landlords who reduce risk. Installing smoke detectors, carbon monoxide alarms, and security systems could help you qualify for safety-related discounts. In cities like Grand Rapids, where winter storms are common, consider storm-proofing upgrades.
- Keep your property well-maintained. Well-maintained properties are less likely to have claims. Regularly inspect your rental to catch small issues—like leaky pipes or loose roof shingles—before they turn into expensive problems.
Still have questions?
Interested in learning more about Michigan rental property insurance? Here are answers to some of the most frequently asked questions.
Is rental insurance required in Michigan?
No, the state does not legally require landlord insurance in Michigan. Even still, landlord insurance is the best way to protect your property from financial risks like fire damage, tenant lawsuits, or loss of rental income.
How much renters insurance should a landlord in Michigan require?
There’s no set amount of renters insurance you should require, but a good rule of thumb is to ask tenants to get at least $100,000 in liability coverage. This could help cover tenant-caused damage to your property or injuries that occur in the rental. You can include renters insurance requirements in your lease agreement.
What will you most likely need to insure as a landlord in Michigan?
As a landlord, you’ll need to insure the structure of your rental property (dwelling coverage), liability risks in case tenants or visitors get hurt, and loss of rental income if your property becomes unlivable after a covered claim. You may also want to insure appliances or tools you leave on the property for maintenance.
Who has the cheapest landlord insurance in Michigan?
The insurance company with the cheapest landlord insurance in Michigan will depend on your location, property type, and coverage needs. The best way to find an affordable policy is to shop around and compare quotes from multiple providers. Local agents may also know which insurers offer region-specific discounts, especially for homes in areas like Ann Arbor or Traverse City.
What factors influence the price of landlord insurance in Michigan?
Several factors influence your Michigan landlord insurance rates. The biggest ones are your location, property value, coverage limits, deductibles, and claims history.
