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LANDLORD INSURANCE · COST
Landlord Insurance Cost in 2026
Real premium ranges by dwelling limit and property type, the eight factors that actually move your rate, and what Illinois rentals are paying right now.
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Quick Answer: Landlord insurance costs $1,478 per year on average nationally and about $2,000 per year in Illinois for a rental with a $200,000 dwelling limit. That is roughly 15 to 25 percent more than a comparable homeowners policy. Most single family rentals land between $900 and $2,800 a year depending on dwelling limit, construction, roof age and location.
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Get My Free QuoteLandlord insurance cost by dwelling limit
Your dwelling limit is the single biggest driver of premium. It should reflect what it costs to rebuild the property today, not what you paid for it and not what Zillow says it is worth.
| Dwelling limit | Typical annual premium | Roughly per month |
|---|---|---|
| $100,000 | $500 to $1,000 | $42 to $83 |
| $200,000 | About $2,000 in Illinois | About $167 |
| $300,000 | $900 to $1,800 | $75 to $150 |
| $500,000 | $1,400 to $2,800 | $117 to $233 |
| $1,000,000+ | $2,500 to $5,000+ | $208 to $417+ |
Estimates only. Your premium depends on construction, roof age, protection class, claims history, deductible and how the property is occupied.
Landlord insurance cost by property type
More units means more tenants, more liability exposure and more claim frequency. Premium per unit usually falls as the building gets bigger, but total premium rises.
| Property type | Typical annual premium | Written as |
|---|---|---|
| Rental condo or townhome | $400 to $900 | DP-3 walls-in (the HOA master policy covers the structure) |
| Single family rental | $900 to $2,800 | DP-3 dwelling fire |
| Duplex or 2 unit | $1,200 to $3,200 | DP-3 dwelling fire |
| Triplex or fourplex | $2,000 to $6,600 | DP-3 or small commercial |
| 5+ units or apartment building | Quoted per building | Commercial habitational program |
The 8 factors that set your premium
Two identical looking rentals a mile apart can price 40 percent differently. Here is what carriers are actually rating.
1. Rebuild cost
The dwelling limit. Everything else is a modifier on this.
2. Roof age and material
A roof over 15 years old can move you to actual cash value or get you declined outright.
3. Location and protection class
Distance to a fire hydrant and a staffed fire station. Chicago area rentals price above downstate.
4. Claims history
Both yours and the property's. Two water claims in five years is a surcharge or a decline.
5. Deductible
Moving $1,000 to $2,500 often cuts 10 to 15 percent. On a rental you are not paying it out of household cash.
6. Occupancy type
Long term lease rates best. Month to month, student and short term rentals cost more or need a different form.
7. Systems age
Knob and tube wiring, Federal Pacific panels, galvanized or polybutylene plumbing are common declines.
8. Liability limit
Going from $300K to $500K is usually a small dollar increase and the best value on the policy.
Want the full math on a real quote? Open this.
A 3,700 square foot, three unit building in the Chicago area, quoted across five carriers in the current market, came back in a range of $2,400 to $6,600 per year. One carrier landed at $3,137. Same building. Same limits. Same day.
The spread came from three things: how each carrier treated the 18 year old roof (replacement cost versus actual cash value), whether water and sewer backup was built in or added, and each carrier's own appetite for three unit habitational risk that year.
The point: a $4,200 spread on one building is not unusual, and it is invisible if you only get one quote. Nothing about the building changed. Only who was asked.
Nationally the state averages run from roughly $892 a year in the cheapest states to $2,561 in the most expensive, which tells you location alone can nearly triple the number.
What Illinois landlords are paying
The Illinois average sits near $2,000 per year for a rental with a $200,000 dwelling limit. Within the state the spread is wide:
- Chicago and near suburbs. Highest in the state. Older housing stock, combined sewers and higher liability severity.
- Collar counties (McHenry, Kane, Lake, DuPage). Mid range. Newer construction and better protection classes help.
- Downstate. Generally the lowest, though rural protection class can offset the benefit.
- Fox River corridor. Add a separate flood policy. It is never included and the corridor floods.
For county level detail see our Illinois landlord insurance page, or the deeper breakdown in how much a landlord policy costs in Illinois.
How to lower your landlord insurance premium
- Raise the deductible. $1,000 to $2,500 typically saves 10 to 15 percent.
- Require renters insurance in every lease. Some carriers credit it, and it moves tenant contents claims off your policy entirely.
- Bundle the portfolio. One habitational program across all of them beats separate policies once you hit four or five properties.
- Document upgrades. A new roof, panel, furnace or water heater is a rate credit, but only if the carrier is told.
- Do not under-insure to save premium. Coinsurance penalties at claim time cost far more than the premium you saved.
- Re-shop every renewal. Carrier appetite for habitational risk swings year to year. Last year's best price is rarely this year's.
See what your rental should actually cost
We shop 20+ A-rated carriers on every rental. If your current policy is already the best price, we will tell you that too.
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Landlord Insurance Cost FAQ
How much does landlord insurance cost?
Landlord insurance costs about $1,478 per year on average nationally. In Illinois the average is closer to $2,000 per year for a rental with a $200,000 dwelling limit. Most single family rentals fall between $900 and $2,800 a year depending on dwelling limit, roof age, construction and location.
Is landlord insurance more expensive than homeowners insurance?
Yes. A landlord policy typically runs 15 to 25 percent more than a comparable homeowners policy on the same building. Tenant occupied property has higher liability exposure and claim frequency, and the landlord form adds coverages a homeowners policy does not include, most notably loss of rental income.
How much landlord insurance do I need?
Set the dwelling limit at the current cost to rebuild the property, which is different from market value and from your mortgage balance. Carry at least $300,000 in liability and move to $500,000 if the increase is small, which it usually is. Add loss of rents equal to 12 months of gross rent, and add a personal umbrella once you own more than one rental.
Is landlord insurance tax deductible?
Premiums on a rental property are generally treated as a deductible operating expense against rental income, unlike homeowners insurance on your own residence. Confirm your specific situation with your tax professional, since how you hold the property affects the treatment.
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Send us the address and we will shop it across 20+ A-rated carriers. Most quotes come back the same business day. No agency fees, ever.
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DR
Reviewed by Dave Rysavy
VP, Personal Lines · Pro Insurance Group. Dave places personal lines and rental property coverage for Illinois property owners at Pro Insurance Group.
Sources: National average annual premium and homeowners comparison, Insurance Information Institute. Premium ranges by dwelling limit and state averages, current carrier market data. Illinois average, Pro Insurance Group book data. Figures reviewed July 2026 and are estimates, not quotes.
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