If you own a tiny house, you should make sure it's well protected with some form of insurance coverage.
Updated December 11, 2020|4 min read
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If you have a tiny house or plan on owning one either for your own use or as a rental property, you should make sure it’s well-protected with at least some form of insurance coverage. You can’t insure a tiny house with a standard home insurance policy, but there are a number of other coverage options available to you depending on how you use the home.
If you’re renting out your tiny house through a service like Airbnb or you’re using it as a vacation home, you’re going to need different coverage than if you live there full time. Your tiny home’s build is also a key factor in determining your insurance needs: a fixed-foundation tiny house is going to need different coverage than a tiny house on wheels that you use to travel from one spot to the next.
In some cases, you can combine different types of insurance policies — like a manufactured “mobile” home policy and an RV insurance policy — to protect the home when it's both stationary and moving. But as tiny homes increase in popularity — particularly homes of the DIY variety that are more difficult to insure — speciality insurers are beginning to write policies that cater specifically to different kinds of tiny homes.
Tiny house insurance protects homes 600 sq ft. or smaller from unexpected losses, like damage from lightning and vandalism
If your tiny house is stationary and you finance it yourself or with a personal loan, you’re not legally required to insure it
However, mobile tiny homes are subject to the same state insurance requirements as cars and RVs
The cost to insure a tiny home depends on where the home is located, whether or not it’s stationary, who built it, and how it’s used
As long as your tiny house is stationary and you finance it yourself or with a personal loan, you’re not legally required to insure it. However, once your tiny house hits the road, it’s subject to the same state insurance requirements as cars and RVs. That means that, depending on your state, you’ll likely need liability car insurance at the very least.
If you plan on financing your tiny home with an RV loan, your RV lender may also require that you get insurance before letting you take out the loan. Your RV lender’s insurance requirement works like any mortgage lenders’ requirement for home insurance — once the loan is paid off, you’re no longer required to have insurance.
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Before constructing or purchasing your tiny house, you should have a general sense of how you’re going to insure it. Some insurers, for example, won’t insure your tiny house if it isn’t certified by the Recreational Vehicle Industry Associated (RVIA) or the National Organization of Alternative Housing (NOAH). If you’re constructing a DIY house or it’s being built by an uncertified builder, look into what insurance options you have prior to building the home. Otherwise, you may need to self-insure.
If your tiny house is on wheels, it’s RVIA-certified, and you plan on moving it around often, you should first look into an RV policy, which will cover your tiny house both when it’s parked and when it’s moving. Most major insurers offer RV policies which feature a full suite of protection, such as:
Structural coverage - protects your tiny home’s structure and foundation
Liability insurance - covers lawyers’ fees, medical bills, and lawsuit judgements when you’re responsible for injury someone else or damaging their property
Medical payments - reimburses you for medical expenses when a guest is injured on your property, regardless of who is at fault
Collision coverage - covers damage to your mobile tiny home after a collision with another vehicle or an object
Uninsured and underinsured motorist protection - protects you financially when you get in an accident with a driver who has insufficient coverage or no insurance at all
However, standard RV coverage is fairly limited, as these policies are typically only intended for RVs that you use as a vacation home. If you live in the tiny house permanently, you’ll want to be sure you get a “full timer’s” policy, which is offered by major insurers like Progressive and Foremost.
If your tiny house was built by a NOAH-certified builder and you don’t move it more than a couple of times a year, your easiest insurance option would probably be a manufactured home insurance policy, also called a mobile and manufactured home policy, which is offered by most insurance companies.
There are a couple considerations to keep in mind when it comes to mobile home insurance: if you ever plan on moving your home to a new location, you’ll need a transit endorsement to cover your home and personal belongings while on the road. You’ll also need to inform your insurance company whenever you switch locations.
If you plan on moving your mobile home at any point, check with your insurance company to see if they offer temporary transit endorsements.
Most large home insurance carriers won’t insure tiny homes that aren’t certified by the RVIA or the NOAH, but there are a number of specialized tiny home insurers who will.
Since your home isn’t certified, your insurer may want evidence that the build materials, wiring, and plumbing are up to code. To better assist your insurer during their inspection and make your home more insurable, it’s a good idea to take photos of the wiring as it’s being built.
While building a tiny house doesn’t cost nearly as much as building a single-family house, the insurance costs are in the same range as a standard home. The amount you pay depends on four factors: where your home is located, whether or not it’s stationary, who built it, and how it’s used.
Tiny home insurer, Darrell Grenz, of InsureMyTinyHome in Portland, Oregon says insurance can cost around $600 a year, and MAC Insurance, a Portland-based company that insures tiny homes throughout the country, says it can cost as little as $400 and as much as $1,500 annually.
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