For the past few decades, the average sized home has grown consistently from year to year. And, until recently, there was not even a tiny house market to speak about. However, at a fairly quick pace, this slice of the real estate market has caught on like wildfire. In fact, the tiny house real estate market has outperformed even the most aggressive growth estimates.
This unanticipated rapid growth was ultimately, the motivating factor that caused the insurance industry to develop underwriting standards to use when determining how to provide insurance for a tiny home. The documented rapid growth has prompted the insurance industry to provide additional tiny house insurance options.
The Two Types of Tiny Homes
To complicate matters, tiny homes are built as either non-mobile (affixed to a foundation) or as mobile (a hybrid between a home and an RV). The non-mobile tiny home allowed insurance companies to offer a modified traditional home insurance policy. The mobile tiny home was more challenging and took some innovative thinking to create appropriate solutions.
Tiny Home Insurance Covers...
A tiny home policy is insurance written on an HO-3 form which is a Special Form Homeowners Policy. Available coverage includes:
- Tiny Home Dwelling
- Personal Property
- Loss of Use,
- Separate Structures
- Personal Liability, and
- Medical Payments to Others
While each coverage is available, it is noted that not all are required.
The Tiny Home Insurance Policy
One type of a tiny home policy is designed for those who own a mobile tiny home but have very little intent on moving it but a few times. The benefit of this tiny home policy is that it allows for simultaneous coverage of these lines of insurance:
- Structural Coverage – i.e. loss due to a fire, etc.
- Liability Coverage – i.e. someone is injured in your tiny home
- Content Coverage – i.e. theft, etc.
While this tiny home insurance policy mimics the more traditional homeowner’s insurance policies that have been offered since the 1950’s, tiny homeowners must purchase this specific policy from a ‘Tiny Home Insurance Broker’ as tiny home coverage is not available by every insurance broker. This tiny home insurance policy is available for certified tiny homes and even the DIY builds. DIY builders should document their progress stage by stage, with the use of photos to show the insurance company.
It’s also imperative to note that the moment a mobile tiny home is attached to the hitch of a tow vehicle, the tiny home insurance coverage is no longer active. Additional coverage can be obtained to cover the mobilized tiny home.
Tiny home insurance coverage is still only available in some areas across the country, although the coverage is expanding as fast as the tiny home market has grown. Check out available options for tiny home insurance by following this link.
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