12 min read
Top 5 Home Insurance Myths
Most homeowners do not learn what their policy actually covers until they file a claim. By then it is too late. After...
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.
Get My Quote Call 833-776-4671- Personal Insurance
- Landlord Insurance
- Landlord Insurance Cost
★ 5-Star Google Reviews ✓ 20+ Carriers Shopped ✓ No Agency Fees, Ever ✓ Local to Elgin & Huntley
The short answer
Landlord insurance in Illinois costs about $1,800 to $3,400 a year for a typical single-family rental, or roughly $150 to $283 a month. A rented condo unit runs $450 to $950. A two to four unit building runs $2,400 to $6,800.
Those ranges assume a replacement cost policy with a loss-of-rents limit, which is the coverage most owners actually want.
Landlord insurance, sometimes written as a dwelling fire or DP-3 policy, covers a property you own and rent to someone else. It replaces the homeowners policy you would carry if you lived there, and it adds two things a homeowners policy will not give you: liability protection for injuries to tenants and guests, and coverage for the rent you lose while the property is uninhabitable.
Figures on this page are estimated ranges based on Illinois market conditions in August 2026. They are not quotes. Your actual premium depends on the building, and no number is final until a carrier has quoted your specific property.
On this page
Cost by dwelling limit · Why published averages are wrong · Versus homeowners insurance · The same rental, three carriers · What moves your premium · What you are actually buying · When to move to commercial · How to lower your cost · Frequently asked questions
How much does landlord insurance cost in Illinois?
Most Illinois landlord policies fall between $1,100 and $8,000 a year, driven primarily by the dwelling limit.
Estimated annual premium by dwelling limit, Illinois, August 2026.
| Dwelling limit | Per year | Per month |
|---|---|---|
| $100,000 | $1,100 – $1,600 | $92 – $133 |
| $200,000 | $1,800 – $2,600 | $150 – $217 |
| $300,000 | $2,400 – $3,500 | $200 – $292 |
| $500,000 | $3,600 – $5,400 | $300 – $450 |
| $750,000 | $5,200 – $8,000 | $433 – $667 |
How we built these ranges
They reflect replacement cost policies with a 12-month loss-of-rents limit, written in the standard Illinois market on properties with no open claims. Actual cash value policies and policies without loss of rents price lower and are excluded, because they are not the same product.
Illinois property rates rose roughly 50% between 2021 and 2024 per Consumer Federation of America analysis, so any range published before 2025 understates today's market.
Cost by property type
Estimated annual premium by property type, Illinois, August 2026.
| Property type | Estimated annual premium |
|---|---|
| Rental condo or townhome | $450 – $950 |
| Single-family rental | $1,800 – $3,400 |
| Duplex or 2 unit | $2,400 – $4,400 |
| 3 to 4 unit building | $3,200 – $6,800 |
A rented condo prices low because the association's master policy covers the structure. You are insuring the interior, your improvements, liability, and lost rent. It is a genuinely different product, and it is the main reason published national averages look lower than what a house actually costs to insure.
Why published landlord insurance averages are unreliable
Most published landlord insurance averages are not measurements. They are a homeowners average multiplied by 1.25.
The Insurance Information Institute states that landlord policies cost "about 25 percent more" than a homeowners policy. That page cites no study and carries no date. Publishers then apply that multiplier to whatever homeowners figure they have on hand.
The same calculation, three different starting points, three different national averages.
| Homeowners figure used | × 1.25 | Published as |
|---|---|---|
| $1,192 (mid-2010s) | → | $1,478 |
| $1,754 | → | $2,193 |
| $2,601 | → | $3,251 |
The 120% spread between the lowest and highest published national average is entirely an artifact of which year's homeowners number each publisher grabbed. It says nothing about landlord pricing.
There is no regulator-published national landlord average
The NAIC collects dwelling fire data but does not publish a landlord-specific average premium. Every national figure you will find traces back to that 25% rule of thumb or to an undisclosed quote range.
The Illinois numbers in circulation are worse. You will find $998, $1,056, and $1,313 quoted as the Illinois landlord average. All three sit below the Illinois homeowners average, which credible 2026 sources put between $2,630 and $3,380. A landlord policy on the same building costs more than a homeowners policy, not 60% less. Those figures are simply old.
If a cost page will not tell you what its numbers are based on, treat the numbers as decoration.
Why does landlord insurance cost more than homeowners insurance?
Landlord insurance costs roughly 15% to 25% more than a comparable homeowners policy on the same building.
You are insuring someone else's behavior. Tenants maintain a property differently than an owner-occupant. Carriers price that.
You are adding liability for people who are not your family. A tenant or their guest injured on the property is a liability claim against you. Homeowners liability is not written for that exposure.
You are insuring income, not just structure. Loss of rents pays your mortgage while the building is uninhabitable. It has no equivalent in a homeowners policy.
The same rental, quoted by three carriers
On the same Illinois rental, the spread between the highest and lowest carrier quote typically runs 35% to 45%.
This is the real question underneath every search for landlord insurance cost. Not "what is the average," but "am I overpaying?"
Almost nobody publishes the answer, because almost nobody can see it. A carrier sees its own number. An aggregator sees a filtered set. A broker running a full submission sees all of them on the identical risk.
Elgin duplex, built 1961, roof replaced 2019
Estimated annual premium by carrier on one property: $340,000 dwelling limit, $2,600 monthly gross rents. Bars start at zero.
| Carrier A |
| ||
| Carrier B |
| ||
| Carrier C |
|
Spread: 41%, or $1,130 a year. Two-unit properties narrow the carrier panel, which widens the spread. All three offered comparable terms. The difference is appetite, nothing else.
The example that matters most
Chicago two-flat, built 1918, roof replaced 2012, $480,000 dwelling limit, $3,800 monthly gross rents.
| Carrier | Estimated annual premium | Roof settlement |
|---|---|---|
| Carrier A | $4,650 | Actual cash value on the roof |
| Carrier B | $5,780 | Replacement cost |
| Carrier C | Declined | Would not write a 13-year roof |
The cheapest quote is not always the better deal
Carrier A is 20% less and pays roughly half on a hail claim to the roof. On a $480,000 building in a state that ranks second or third nationally for hail, that is not a saving. It is a deferred bill. A quote comparison that only shows premium will never tell you this.
Two more Illinois examples, estimated annual premium across three carriers.
| Property | Low | High | Spread |
|---|---|---|---|
| Huntley single-family, built 2003, roof 2020 | $2,510 | $3,380 | 35% |
| Rockford single-family, built 1974, roof 2016 | $1,720 | $2,390 | 39% |
You cannot see the spread from inside one carrier
If your rental has been with the same company for three years or more, you have never seen what the rest of the market would charge. We will show you every quote side by side, with the roof settlement terms next to each number.
Compare My Carriers Call 833-776-4671No obligation. If your current policy is already the best fit, we will tell you that.
What determines your landlord insurance premium?
Roof age, and why it matters more in Illinois
Roof age is the single biggest eligibility factor on an Illinois rental, because Illinois is one of the most hail-exposed states in the country.
State Farm, the largest writer in the state, paid $906 million in Illinois hail claims in 2023, $899 million in 2024, and $558 million in 2025, ranking Illinois second or third nationally in each of those years. Through June 2026 the company reported nearly 50,000 severe-weather claims in Illinois, with homeowner claims running 47% above the ten-year average.
Settlement basis flips. Published carrier thresholds run from 10 to 16 years before a roof moves toward depreciated settlement. Once it crosses, a hail claim pays actual cash value instead of replacement cost. On a 20-year-old roof that difference is commonly half the cost of the roof.
Wind and hail deductibles are no longer flat. State Farm now requires a minimum 1% wind and hail deductible on Illinois policies and other carriers have followed. On a $300,000 dwelling that is $3,000 out of pocket, not the $1,000 most owners assume they have.
Eligibility, not just price. Past a certain roof age many carriers will not offer replacement cost at all, and some will not quote. A roof replacement is frequently the highest-return capital improvement on an Illinois rental, and the reason is the policy, not the roof.
Not sure what your wind and hail deductible actually is?
It is one line on your declarations page and most Illinois landlords have never checked it. Send us your current policy and we will read it back to you in plain English, free, whether or not you move your coverage.
Have Us Review My PolicyCall 833-776-4671The other seven factors
Dwelling limit and replacement cost. The largest single premium driver. Construction costs have moved enough since 2020 that limits set at purchase are commonly 20% to 30% short today, which creates a coinsurance penalty at claim time.
Loss-of-rents limit. Usually 12 months of rental income. Modest cost, and it is the coverage owners are gladdest to have after a serious loss.
Building age and systems. Illinois carries a lot of pre-1940 housing stock. Knob and tube wiring, fuse boxes, 60-amp service, and galvanized supply lines will restrict or end an application regardless of how well the property shows.
Water and sewer backup exposure. Excluded on a base form, inexpensive to add, and in older Illinois housing with combined sewers and finished basements it is the claim most likely to actually happen to you.
Occupancy and tenant profile. Long-term leases price better than short-term or student rentals. Vacant property is a different policy entirely and costs substantially more.
Claims history. Two or more property claims in three years narrows your carrier options quickly. A single water loss is usually survivable. A pattern is not.
Number of properties. At three or more doors the right structure usually changes.
What does landlord insurance actually pay for?
Roughly two thirds of your premium buys the dwelling coverage. The rest buys liability, lost rent, and the endorsements that decide most claims.
Estimated allocation on a $300,000 dwelling single-family rental in Illinois.
| Coverage | Estimated annual cost | What it does |
|---|---|---|
| Dwelling, replacement cost | $1,950 – $2,400 | Rebuilds the building |
| Premises liability, $500K | $220 – $420 | Defends and pays if a tenant or guest is injured |
| Loss of rents, 12 months | $150 – $340 | Pays the rent while the property is uninhabitable |
| Other structures | $70 – $190 | Detached garage, fence, shed |
| Water and sewer backup | $90 – $260 | Excluded by default. Add it |
| Ordinance or law | $95 – $280 | Rebuilds to current code, not the code in force in 1952 |
| Equipment breakdown | $55 – $160 | Furnace, water heater, electrical panel |
The first three are the policy. The rest are endorsements, and not every policy carries all of them, which is why the endorsement column does not sum to the totals above.
Two endorsements matter more in Illinois than anywhere else
Water and sewer backup is the highest-frequency claim in older Illinois housing and it is not on a base form. Ordinance or law matters on any pre-1980 building, because a partial loss triggers code compliance on the rebuild, and the gap between what the policy pays and what the municipality requires regularly runs into six figures.
When should a landlord move to a commercial policy?
Move to a commercial habitational program at three or more doors, anything above four units, title held in an LLC, or when you need liability limits above what a personal lines form offers.
Stacked individual landlord policies stop making sense faster than most owners expect. A habitational program delivers uniform limits, one renewal date instead of nine, and frequently a lower total premium than the policies it replaces.
Stay on individual policies when you own one or two properties in your own name with straightforward occupancy. The commercial form adds cost and complexity you do not need yet.
Full pricing is in our habitational insurance guide.
How to lower your landlord insurance cost
The seven moves below are ordered by impact, and the first one changes your eligibility, not just your price.
- Replace an aging roof. In Illinois this is the highest-return move available, and it changes eligibility, not just price.
- Raise the deductible. $1,000 to $2,500 is commonly a 10% to 15% reduction. While you are in there, check what your wind and hail deductible actually is, because it may be a percentage.
- Correct the dwelling limit. Both directions. Overinsured wastes premium, underinsured triggers a coinsurance penalty.
- Consolidate at three or more doors.
- Require renters insurance in the lease. It shifts exposure off your policy and several carriers credit it directly.
- Bundle where multiple properties or personal lines sit with one carrier.
- Remarket every two to three years. Not annually. Loyalty is not rewarded in this market, but constant churn has its own cost.
What Our Clients Say
Landlord Insurance Cost FAQ
How much does landlord insurance cost?
About $1,800 to $3,400 a year for a typical single-family rental in Illinois. Condo units run $450 to $950. Two to four unit buildings run $2,400 to $6,800.
How much is landlord insurance per month?
Roughly $150 to $283 a month for a single-family rental, based on a $200,000 to $300,000 dwelling limit.
Is landlord insurance more expensive than homeowners insurance?
Yes, typically 15% to 25% more on a comparable building, because it adds premises liability for tenants and guests, adds loss-of-rents coverage, and reflects the underwriting reality that tenants maintain property differently than owner-occupants.
Why do published landlord insurance averages vary so much?
Because most are the same calculation with different inputs. Publishers take a homeowners average and multiply by the Insurance Information Institute's 25% rule of thumb, so the answer depends entirely on which year's homeowners figure they used. There is no regulator-published national landlord average.
Does my homeowners policy cover a property I rent out?
No. Homeowners forms are written for owner occupancy. Renting the property out without converting to a landlord form gives the carrier grounds to deny the claim.
Is landlord insurance required by law in Illinois?
No Illinois statute requires it. Your lender will require it on any mortgaged investment property, and some municipal rental registration programs require evidence of coverage.
Does landlord insurance cover tenant belongings?
No. Tenant possessions are covered by the tenant's own renters insurance, which you should require in the lease.
Does landlord insurance cover loss of rent?
Only if a loss-of-rents limit is on the policy, usually written as 12 months of rental income. It is not automatic on every form.
Does landlord insurance cover water damage?
Sudden and accidental water damage, generally yes. Sewer and drain backup, generally no unless the endorsement is added, and in older Illinois housing that is the claim most likely to occur.
Does landlord insurance cover tenant damage?
Sudden accidental damage is usually covered. Wear and tear, neglect, and deliberate damage by a tenant generally are not, though vandalism coverage applies in some circumstances.
How much does one claim raise my premium?
A single non-catastrophe claim commonly moves renewal 10% to 20%. The larger effect is on eligibility, since two or more claims in three years substantially narrows carrier options.
Do I need an umbrella policy on a rental?
If you own more than one property or have meaningful personal assets, yes. Excess liability typically costs a few hundred dollars a year against the exposure it covers.
Is landlord insurance tax deductible?
Premiums on an investment property are generally a deductible operating expense. Confirm with your CPA for your situation.
Does landlord insurance cover short-term rentals?
Not on a standard form. Airbnb and short-term occupancy require a specific endorsement or a purpose-built short-term rental policy.
How much landlord insurance do I need?
Enough dwelling coverage to rebuild at today's construction costs, a loss-of-rents limit matched to your actual rents, and liability high enough that a serious tenant injury does not reach your other assets. For most owners with more than one property that means adding an umbrella.
How fast can I get a landlord insurance quote?
Most single-property landlord quotes come back the same business day. Portfolios and habitational programs take two to three business days.
Get a real number for your property
We quote your rental across our full carrier panel and show you the spread, including which carriers will write your roof age and which will not.
Get My Landlord Quote Call 833-776-4671Same business day on most single-property quotes. Prefer to text? Send quoteme to 312-878-9416.
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 and methodology: Premium figures are estimated ranges for the Illinois market as of August 2026, based on standard-market carrier pricing for replacement cost policies with loss-of-rents limits. They are not quotes. External data: Insurance Information Institute on landlord versus homeowners pricing; NAIC homeowners insurance report; Consumer Federation of America Illinois rate analysis; State Farm Illinois severe weather and rate filings; Illinois homeowners averages from Insure.com and Insurify. Reviewed August 2026.
3 min read
What Does Renters Insurance Cover? (2026 Guide)
Dave Rysavy: Jun 23, 2026
Quick Answer: Renters insurance covers three things: your personal belongings, your personal liability, and extra...