In-law Apartments

Answer:

An in-law apartment is typically attached to or built inside another home. It may have its own appliances, along with separate kitchen and bathroom facilities. Many have private entrances as well.

Determining whether an in-law apartment is covered under your regular homeowners insurance policy can be a bit tricky, however. In some cases, you may actually need a separate renters insurance policy to cover your in-law apartment. To complicate matters further, the criteria for this decision may vary from one insurer to another.

For some insurance companies, the presence of a private entrance is the deciding factor in determining whether a separate policy is needed. If there is a private entrance, these insurers consider the in-law apartment a separate living unit, and the house is deemed a two-family home. In this case, your standard homeowners insurance may cover the structure but not the contents belonging to the in-law apartment. Anyone occupying the unit will need to purchase renters insurance, even if they are members of your immediate family.

Other insurers take a more liberal stance where in-law apartments are concerned. Instead of using the separate-entrance test, some insurers look at whether the in-law apartment has its own address, or whether it has separate utility hookups. Others base their determination on whether the person occupying the in-law apartment is a relative. Insurers using these criteria are much more likely to consider the in-law apartment as part of your home and therefore include it in the coverage of your homeowners policy.

But what if you don't have a full-time occupant of your in-law apartment, and you own the contents? Again, the answer depends on which insurer you ask. To make sure your insurance coverage is adequate for your home and personal property, check your policy carefully and talk to your insurer.