What Landlords in Northwest Arkansas Need to Know About Landlord Insurance in 2025

If you own rental property in Bentonville, Rogers, Fayetteville, Springdale, or anywhere in Northwest Arkansas, you’ve probably asked yourself:

“Is my homeowners insurance enough to cover my rental property?”

The short answer: No.

A standard homeowners policy (HO‑3) does not cover rental activity. If a tenant causes damage, gets injured, sues you, or stops paying rent and you can’t access the property for months — your personal home insurance won’t respond.

That’s where landlord insurance (also called dwelling fire or DP‑3 policies) comes in.

As an independent insurance agency serving property owners across NWA, OZK Insurance works with landlords who own:

• Single-family homes
• Duplexes and triplexes
• Condos rented to tenants
• Short-term rentals (Airbnb, VRBO)
• Properties under renovation between tenants
• Homes rented to family members

This guide breaks down:

• What landlord insurance actually covers
• How it differs from homeowners insurance
• What endorsements NWA landlords should add
• Real examples of claims we’ve seen locally
• How to avoid costly coverage gaps
• Why independent agencies save landlords money and headaches

Let’s dive in.

Part 1: What Is Landlord Insurance?

Landlord insurance is a specialized property insurance policy designed for homes, condos, or multi-family units that are rented to tenants.

It typically includes three core components:

1. Dwelling Coverage (Coverage A)

Protects the physical structure of the rental property from:

• Fire
• Wind and hail
• Lightning
• Vandalism
• Theft
• Certain water damage events

2. Liability Coverage

Protects you if a tenant or guest is injured on the property and sues you for:

• Medical expenses
• Legal defense costs
• Settlement or judgment amounts

3. Loss of Rents Coverage

Reimburses you for lost rental income if the property becomes uninhabitable due to a covered loss (e.g., fire, storm damage).

Part 2: How Landlord Insurance Differs from Homeowners Insurance

Many first-time landlords in NWA make the mistake of keeping their homeowners policy active after converting their home into a rental.

Here’s why that’s a problem:

Feature	Homeowners (HO‑3)	Landlord (DP‑3)
Covers rental activity	❌ No	✅ Yes
Personal property coverage	✅ Yes	❌ No (tenant’s responsibility)
Loss of use (for you)	✅ Yes	❌ No
Loss of rents (for landlord)	❌ No	✅ Yes
Liability for tenant injuries	⚠️ Limited/excluded	✅ Yes
Vandalism by tenant	❌ No	⚠️ Sometimes (with endorsement)

Bottom line:
If you rent out a property and don’t switch to landlord insurance, you’re essentially uninsured.

Part 3: What Landlord Insurance Does NOT Cover (And What You Should Add)

Standard landlord policies have gaps. Here are the most common exclusions — and how to fix them:

1. Tenant-Caused Damage (Malicious or Intentional)

Standard policies exclude intentional damage by tenants.

Solution:
Add a Vandalism and Malicious Mischief endorsement or Tenant Damage coverage.

Real NWA example:
A Rogers landlord evicted a tenant who then punched holes in walls, broke windows, and poured paint on carpets. Without the endorsement, the landlord paid $8,400 out-of-pocket.

2. Sewer Backup and Water Damage from Drains

Most policies exclude water that backs up through drains, toilets, or sump pumps.

Solution:
Add Water Backup coverage (typically $50–$150/year).

Real NWA example:
A Bentonville duplex had a sewer line backup that flooded both units. The landlord had no backup coverage and paid $11,200 for cleanup and repairs.

3. Ordinance or Law Coverage

If your rental is damaged and local building codes require upgrades (e.g., electrical, plumbing, ADA compliance), standard policies won’t cover the extra cost.

Solution:
Add Ordinance or Law coverage (usually 10–25% of dwelling coverage).

4. Flood and Earthquake

These are never included in standard landlord policies.

Solution:
Purchase separate flood insurance through the National Flood Insurance Program (NFIP) or a private carrier.

Northwest Arkansas has seen increased flooding in recent years, especially in:

• Low-lying areas near Beaver Lake
• Properties near creeks in Fayetteville and Springdale
• New developments with poor drainage

Most landlords don’t realize they’re underinsured until a claim is denied.OZK Insurance reviews your rental property and recommends the exact endorsements you need — no upselling, just smart coverage.

Part 4: Loss of Rents Coverage – Why NWA Landlords Need It

Loss of rent coverage is one of the most underrated parts of a landlord policy.

Here’s how it works:

• Your rental property is damaged by a covered peril (fire, storm, etc.)
• The property becomes uninhabitable
• You can’t collect rent while repairs are being made
• Your policy reimburses you for the lost rental income (up to policy limits)

Real NWA Example:

A Springdale landlord had a kitchen fire that made the home unlivable for 4 months.

• Monthly rent: $1,450
• Total lost income: $5,800
• Loss of rents coverage: Fully reimbursed

Without this coverage, the landlord would have still owed the mortgage, taxes, and insurance — with zero income.

Part 5: Liability Coverage for Landlords — How Much Do You Need?

Landlord liability protects you if:

• A tenant slips on ice and sues
• A guest is injured by a loose railing
• A child is hurt on the property
• A tenant’s dog bites someone and you’re named in the lawsuit

Minimum Recommendation:

$500,000 in liability coverage.

Better Option:

$1,000,000 in liability + a $1–2 million umbrella policy.

Umbrella policies are inexpensive (often $150–$300/year) and provide an extra layer of protection across all your properties and vehicles.

Part 6: Short-Term Rentals (Airbnb, VRBO) Require Special Coverage

If you rent your property on Airbnb, VRBO, or other short-term platforms, a standard landlord policy will not cover you.

Why?

• Higher turnover = higher risk
• More liability exposure
• Different use classification

What You Need:

1. Short-Term Rental Insurance (specialized DP‑3 or commercial policy)
2. Higher liability limits ($1M minimum)
3. Theft and vandalism coverage
4. Loss of income coverage (for booking cancellations due to covered damage)

Real NWA Example:

A Fayetteville Airbnb host had a guest start a kitchen fire. The host’s standard landlord policy denied the claim because the property was used for short-term rentals.

The host paid $14,300 out-of-pocket.

Part 7: Vacant Property Coverage – What Happens Between Tenants?

If your rental sits vacant for more than 30–60 days (depending on the carrier), your landlord policy may suspend coverage or apply restrictions.

Why Carriers Do This:

Vacant properties have higher risks of:

• Vandalism
• Theft
• Frozen pipes
• Undetected damage

Solution:

Add a Vacant Property endorsement or switch to a Vacant Dwelling policy during the gap.

OZK Insurance helps NWA landlords navigate these transitions without coverage lapses.

Part 8: How Independent Agencies Save Landlords Money

Here’s the advantage of working with OZK Insurance instead of a captive agent or direct carrier:

1. We Compare Multiple Carriers

Different insurers have different appetites for rental properties. Some specialize in:

• Single-family rentals
• Multi-family properties
• Older homes
• Short-term rentals
• Properties with prior claims

We match you with the carrier that offers the best rate and coverage for your situation.

2. We Understand NWA Rental Markets

We know:

• Which neighborhoods have higher theft or vandalism rates
• Which areas are prone to flooding
• Which properties need higher liability limits
• Which endorsements are essential vs. optional

3. We Help During Claims

When a tenant causes damage or a storm hits, we:

• Help you file the claim
• Explain coverage and exclusions
• Advocate on your behalf with the carrier
• Coordinate repairs and documentation

Part 9: Checklist — What Every NWA Landlord Should Have

Use this checklist to ensure your rental property is properly insured:

Landlord insurance (DP‑3) — not homeowners
Dwelling coverage based on replacement cost, not market value
Liability coverage of at least $500,000 (preferably $1M)
Loss of rents coverage equal to 12 months of rent
Water backup endorsement
Ordinance or law coverage
Vandalism/malicious mischief endorsement
Umbrella policy (if you own multiple properties)
Flood insurance (if in or near a flood zone)
Short-term rental endorsement (if applicable)
Vacant property coverage (during tenant turnover)

FAQ: Common Questions from NWA Landlords

“Can I use my homeowners policy if I only rent out part of my home?”

No — you need to notify your insurer and likely switch to a different policy type.

“What if my tenant has renters insurance — do I still need landlord insurance?”

Yes. Renters insurance covers the tenant’s belongings and liability — not your property or your liability.

“How much does landlord insurance cost in Arkansas?”

It varies, but typically $800–$1,800/year for a single-family home, depending on coverage, location, and property age.

“Do I need landlord insurance if I rent to a family member?”

Yes — even if no money changes hands, the property is still being used as a rental.