Why is it that insurance companies don't want to insure property that is rented out?

I would like to buy a trailer and rent it out. I am particular about tenants and I take care of my property. Insurance companies frown on rentals. Why is this when the landlord also wants to have good tenants and a good investment?

OK, trailers depreciate in value - so they only get worth less, not more. Kinda like a car.

If you had a rental house, it at least appreciates with the other real estate, BUT. No type of insurance has MORE LOSSES than rental property. Yep, it's the dregs of the insurance world. You want lots of claims? Insure just rental properties. Landlords just don't maintain them as well as an owner occupant, tenants get mad and trash them on the way out, landlords don't want to insure them for the cost to rebuild (after all, the market value is probably WAY less than the cost to rebuild!), it's just a serious money loser.

So, IF I insured the house you lived in, and you called me up and said you wanted to insure a trailer that you want to rent out, I'd write it with Foremost INsurance - www.foremost.com. It would probably cost you $500 a year - and I'd make $50 off of it. Just enough to cover the time the first year, and then I'd pray you didn't have a claim the first two years, because I won't make any PROFIT off of it until the second year. (kinda like, if you were the landlord, would you be happy to buy a rental property if you couldn't make any money until the SECOND full year you owned it?)

If I DIDN'T insure your "good" business or primary home, I'd tell you sorry, I'm not interested. Because as an agent, I can't make money (aka, stay in business) that way. Just like you'll walk away from a tenant that can't pay you rent that covers your expenses.

PS, "Renters Insurance" covers the renter, aka the tenant, NOT the landlord.

Although you may be particular, the law prevents you from being too particular. And, you could be particular but tenants could fool you. The end result would be that insurance companies would be liable for your mistake. Because of that, the insurance companies will either not insure or make the insurance so expensive you wouldn't want it.

TX Guy

It's called "renter's insurance"

renters insurance is available in most state but it is hard to find for mobile homes

A lot of times tenants don't take care of the property; it doesn't belong to them and they are less likely to care for it. Another reason is that they don't get enough premium to offset losses.

they need insurance that you will or can be that particular. you are not an institution that can be held to guidelines. can you insure that you will remain critical of your clientel even when "in the whole" and really just need to get someone in there? you'll get out if that happens right? then it is not worth entertaining the idea that can possibly go bust in a short time. a trailer park on the other hand might entice an insurance company because they know that there is much more capital working towards the cause of sustaining a business.