Landlord Insurance in Denver: What You Should Know

Owning rental property in Denver can be a profitable move, but it also means insuring against some of the most expensive weather risks in the country. Colorado ranks in the top 10 least affordable states for property insurance, with rates 87% higher than the national average. This is largely due to hail and wildfire damage.

Rather than viewing these premiums as just another expense, think of them as an investment in protecting your property, income, and tenants. The right Denver landlord insurance

policy can mean the difference between a temporary setback and a financial disaster. In this guide, we’ll break down landlord insurance vs. homeowners insurance, compare different policy types, and discuss landlord insurance costs. From picking a plan to filing a claim, this information will help ensure that you and your property are prepared for anything that comes your way. 

What Is Landlord Insurance in Denver? 

Landlord insurance is a specialty policy that protects homes or units you rent to others (not your own residence). There’s no state or federal mandate to buy it, but mortgage lenders and property managers routinely require proof of coverage. A standard policy for a Denver rental usually bundles three main protections:

1. Dwelling coverage: To repair or rebuild the structure after a covered event (like hail, wind, fire, or lightning

2. Liability coverage: To settle claims and pay for medical expenses if someone (tenant or guest) is injured on the property and the court finds you responsible 

3. Loss of rental income coverage: To reimburse you for rent if tenants are forced to move out of the rental during a covered repair 

While most Denver landlord insurance policies cover the essentials, many don’t protect against every possible scenario. Some of the most common exclusions you’ll find listed include: 

• Tenant belongings
• Normal wear and tear
• Pests like rats or termites
• Mold
• Earthquakes, floods, or other natural disasters
• Eviction costs
• Intentional damage

Many landlords choose to add endorsements (optional policy add-ons) for hazards not already included in their Denver landlord insurance policy. You can choose the ones that make the most sense for your property and its location, such as: 

• Equipment breakdown: Pays to repair or replace major systems like furnaces, boilers, or central AC if they fail unexpectedly. 

• Ordinance or law coverage: Helps cover the cost of bringing older properties up to current building codes after a loss. This is especially useful in Denver, where over half of the homes were built before 1980. 

• Sewer and drain backup: Covers damage from backed-up drains or sump pumps, which can happen after heavy rain or snow melting. 

• Vandalism coverage: Protects against crime-related damage from break-ins or vandalism, which can be a concern in areas like East Colfax, Cheesman Park, and Five Points. 

• Wildfire smoke damage: Covers cleaning, repairs, and deodorizing if smoke from wildfires seeps into your property, even if there’s no direct fire damage.  

• Service line coverage: Pays for repairing underground utility lines (water, gas, electric) running to your property, which aren’t covered under most standard policies. 

• Extended loss of rent coverage: Extends your rental income protection for longer rebuild times, which can happen when contractors are booked up after major storms. 

• Hail and windstorm enhancement: Raises payout limits or reduces deductibles for damage from hail, high winds, and flying debris, which are common in Denver.  

• Vacancy coverage: Most policies no longer apply once a home has been vacant for 30+ days. Vacancy coverage ensures your property remains covered even after sitting empty for an extended period. 

When you know what’s covered and what’s not, it’s easier to create a Denver landlord insurance

policy that fully protects your property. 

Comparing Landlord Insurance vs. Homeowners Insurance

If you’re a new Denver landlord, you may assume you’re already covered by your homeowners policy, but the reality is that you’ll need a separate plan. There are several differences between landlord insurance vs. homeowners insurance, and familiarizing yourself with them can help you avoid denied claims. 

First, know that landlord insurance in Denver is meant for properties you’re renting out to tenants and making an income from. Since it’s essentially a business, and because rentals carry more risks, a landlord policy will cover lost rental income, the building itself, and liability for legal or medical fees. It will not protect your personal belongings, and if you want extras, you’ll need to pay to add them to the policy. 

On the other hand, homeowners insurance covers the home you and your family personally live in. These policies are more concerned with your personal belongings, the home itself, and any living expenses you might incur while moving out for covered repairs. 

Another big difference between landlord insurance vs. homeowners insurance is the cost. In most cases, landlord insurance costs more than a homeowners policy, usually by about 25%. Making sure you have the correct policy for each of your properties ensures that you’re protected from all angles. 

Different Types of Rental Property Coverage in Denver

Denver’s rental market is diverse, and so are its landlord insurance policies. When you’re shopping around for the right plan, you’ll come across these different types of “dwelling policies,” which are DP1, DP2, and DP3. Your risk tolerance and budget, along with the unique characteristics of your property, will all influence which one you choose.

DP1 Policies

DP1 policies (Dwelling Fire Form 1) are known as “named peril” plans because they only provide protection for a short list of specific problems like fire, wind, hail, or lightning. These Denver landlord insurance policies pay based on actual cash value (ACV), meaning it subtracts for depreciation. So, if your roof is 15 years old and gets damaged, the check you get will be equal to the value of your old roof (age and wear included), not a brand new one. It’s cheaper, but it leaves a lot out, and that can leave landlords feeling vulnerable. If you just need to show proof of insurance, have a low-value property, or can afford to pay out of pocket for damages, a DP1 plan might be fine for your needs. 

DP2 Policies

DP2 policies (Broad Form) are also a type of “named peril” plan, but they include more events, such as falling trees, burst pipes, vandalism, or snow and ice damage. It pays replacement cost instead of ACV, so your payout will be the full amount it takes to repair or rebuild after damage. Many consider DP2 policies the best landlord insurance in Denver because they offer broader protection without a high premium. 

DP3 Policies

DP3 policies (Special Form) are opposite from DP1 plans. Instead of listing out the events that are covered, it assumes that every scenario is protected unless the policy states otherwise. Like DP2, it pays replacement cost, so there’s no need to worry about depreciation. It’s the most expensive type of landlord insurance in Denver, but also the most comprehensive. These policies will often put your mind at ease and tend to be popular for higher-value or historic homes. 

Umbrella Insurance

You can buy the most comprehensive landlord insurance in Denver, but even then, serious incidents could push your claim above your policy’s limit. For example, if a tenant slips on the steps outside of their unit because of ice, they could sue you for not putting salt down. If they win the lawsuit and the judgment is more than your policy’s liability coverage limit, you would have to pay the extra amount out of pocket. 

To avoid those devastating types of financial setbacks, consider purchasing an umbrella insurance policy, which adds an extra $1-$2 million or more of liability coverage. These policies cost about $383 per year on average, making it relatively inexpensive compared to the added protection it offers.

Limited Liability Company (LLC)

Getting Denver landlord insurance is essential for protecting your rental, but forming a Limited Liability Company (LLC) can also help. An LLC works by separating your rental business from your personal life. If someone sues over something that happened at your rental, they go after the LLC’s assets instead of your home or savings. 

Have a big portfolio? Consider putting each property into its own LLC. That way, your entire operation won’t shut down just because of a single issue at one of the rentals. While an LLC won’t replace landlord insurance in Denver, it works well alongside it, both from a legal and financial standpoint. 

Landlord Insurance Costs in Denver

Denver landlords generally pay more for insurance than in many other U.S. cities, and the reasons are specific to its location. The metro area sits in the heart of “Hail Alley,” a zone notorious for large, damaging hailstones. The May 2017 hailstorm caused an estimated $2.3 billion in insured losses, making it one of the costliest storms in U.S. history. Big events like this are always a possibility, which pushes up premiums for everyone.

Landlord insurance costs $1,608 per year in the state of Colorado, which comes out to $134/month. However, that price is often higher in the Mile High City, where changing building codes, a growing population, volatile weather patterns, and an aging housing market drive up both the frequency and cost of claims. Other factors that can impact your premium include:

• Type of policy: A basic DP1 policy will almost always cost less than a DP3 plan with broad protections and several endorsements. 

• Location-specific risks: Properties near the South Platte River, Cherry Creek, or in mapped flood zones will often be more expensive to insure. Properties in high-crime neighborhoods will usually have higher premiums.  

• Optional add-ons: Every endorsement you add to the policy can raise its price. 

• Property age and condition: Updated HVAC systems, impact-resistant roofs, and other renovations may get you a lower price, while older homes with original wiring or plumbing can raise rates significantly.

• Property features: High-liability amenities like swimming pools or trampolines will raise your premium, as they expose tenants and guests to more risk. Security systems, fire sprinklers, and upgraded locks may qualify you for discounts. 

• Claims history: Past claims, either by you or on the property, can increase your premium. Insurance companies may also factor in the number of claims in the neighborhood. 

• Property type: A single apartment unit will often cost less to insure than a large multi-family home.

• Deductible amount: Opting for a higher deductible can lower your premium. 

In Denver, post-storm labor shortages can drive up repair prices, and insurers price policies with those things in mind. While you’ll pay more here than in many other states, remember that you’re insuring against some of the most costly and consistent weather risks in the country. 

How to File a Denver Landlord Insurance Claim

When damage happens, it’s important to know what to do, especially after a storm that affects a lot of homes. Thousands of people will be reporting claims at the same time, and acting quickly will help your claim stay toward the top of the pile. Follow these steps to file a Denver landlord insurance claim: 

• Confirm your policy and contact your insurer: Check your declarations page for your insurer’s name, coverage limits, deductibles, and effective dates. Contact the insurance company directly, either through their online claim portal or by calling, and report the loss right away. 

• Document damage and review coverage: Take clear photos and videos of the damage, ensuring they’re timestamped. Review your declarations page to understand what’s covered and identify any limits or exclusions that might affect your payout. 

• Prevent further damage while you wait: Make temporary repairs such as boarding up broken windows, tarping a damaged roof, or shutting off the water to prevent frozen pipes from bursting. Hold off on major repairs. 

• Provide evidence and meet the adjuster: Submit repair estimates, inspection reports, and any relevant police or fire records. When the adjuster visits, walk them through all the damage, pointing out less obvious issues to ensure every base is covered. 

• Keep detailed records: Save all correspondence, including emails, letters, and notes from phone calls. Hold onto repair receipts and material invoices. This paper trail is crucial if you need to dispute the settlement amount or appeal a denial. 

Colorado-based insurers must settle, approve, or deny a claim within 30 days, as long as you’ve provided them with all the information they need. However, if you submit the claim by mail, they have 45 days. Complex claims can take up to 90 days, so ensure you’re on top of the process. 

Wrapping Up: Why You Need Landlord Insurance in Denver

It’s easy to see the appeal of being a property owner in Denver. The city’s strong housing market, mountain scenery, and regular influx of tenants make it a great place to invest. At the same time, the city’s history of fast-moving wildfires, sudden deep freezes, and billion-dollar hailstorms are real and well-documented. Without the right coverage, you’re relying on luck, and that’s rarely an effective (or profitable) business plan. 

Getting landlord insurance in Denver is a powerful way to protect your rental property, your income, and your tenants. Handling all of this on your own can be stressful, but you don’t have to do it alone. Pairing the right coverage with a knowledgeable property management team gives you even more protection. Contact us today, and let’s work together to keep your investment safe no matter what the city throws at you.