- Whether they’re mobile or fixed, tiny homes have unique features and shouldn’t be insured with a traditional homeowners policy.
- Although many tiny homes double as travel trailers, there can be downsides to insuring them as such.
- Tiny home insurance will allow you to replace or repair your tiny home and its contents in case of damage or theft.
Tiny home owners are their own breed. You have to be pretty adventurous to pare down your whole life to what can fit in a tiny home. Maybe you like the price tag and the idea of avoiding a mortgage. Maybe you want to travel to music festivals or national parks year-round. Or maybe you admire the minimalism and sustainability of the tiny home lifestyle.
Whatever your motivation, once you buy your tiny home, it’s time to insure it. If you paid for it outright, you may want to avoid the price tag for insurance, but that’s not the wisest move.
Tiny homes are by their very nature often more susceptible to damage than traditional homes. A tiny home on wheels can flip or be hit by an uninsured driver. Tiny homes can be stolen outright—something that’s not really possible with a regular house or a condo. And wind or storm damage can ruin your tiny home and all your well-considered possessions and leave you high and dry.
So if you have a tiny home, it’s time to make sure it’s fully insured. Let’s take a look at the how and why of insuring your tiny home.
What is a tiny home?
First of all, while a studio apartment or a cozy bungalow might seem tiny, they don’t qualify as tiny homes. According to the 2021 International Residential Code, a tiny house is a standalone unit (not an apartment) of 400 square feet or less excluding loft space.
People who own tiny homes do so for their own unique reasons. Some of the most common reasons according to 2020 research include affordability, efficiency, eco-friendliness and mobility.
But some of the very things that make tiny homes desirable also make them challenging to insure. Let’s take a look at the options available for tiny homes.
Why you need specialized insurance
Many tiny homes are mobile and thus might be insured as travel trailers or RVs. A typical RV policy will cover collisions, damage outside of your control (including weather events and theft) and your belongings inside the home.
But Justin Burns, an agent with the Strategic Insurance Agency, a company that offers tiny home-specific policies, says that approach is flawed. Tiny homes are usually not as aerodynamic as RVs and might not meet the codes necessary to qualify for RV coverage. “We take a different approach and insure them with a Dwelling Fire Form 2 policy, similar to a home,” he explains. “That way we are able to offer replacement cost coverage, loss settlement and broad-form peril coverage.”
Tip: Many people buy tiny homes because the lower price allows them to forego a mortgage and pay out of pocket. Without a mortgage, insuring your tiny home isn’t legally required, but it’s still very important to do so to protect your investment.
Tiny homes are also more susceptible to certain damaging events than traditional homes, necessitating a different kind of coverage. “In our experience, tiny homes are more likely to be damaged than stolen, and wind and improper towing tend to be the most destructive,” Burns says. “Once a tiny home topples over onto its side, the unit is essentially a total loss. Some can be salvaged but the damage is usually irreparable.”
Because of the higher likelihood that their home could be irreparably damaged, tiny home dwellers will need to look into policies that cater to their specific situation.
How tiny home insurance works
First, determine if your tiny home is stationary or moveable. Some insurance providers will want you to get your tiny home certified, and the kind of certification depends on whether your home travels or not.
If your home is stationary, you will need to get a certification from the National Organization of Alternative Housing. If it’s moveable, the certification will come from the Recreational Vehicle Industry Association. In either case, the certification process will look similar: your tiny home will be inspected to make sure it meets safety standards.
Tip: The National Organization of Alternative Housing can inspect your tiny home remotely. The inspector will walk you through the process and the video footage of the inspection will be stored on their cloud server for future reference.
Burns says that the team at the Strategic Insurance Agency has built trip endorsement insurance into their standard tiny home policy—even for stationary tiny homes. Without specific insurance, whether it be an RV policy or trip endorsement coverage, tiny homes generally aren’t covered while in motion.
Once your home is certified, choose your tiny home insurance provider. You can find tiny home coverage with smaller companies offering bespoke policies like the Strategic Insurance Agency as well as larger and more established providers like Foremost Insurance Group or American Family Insurance. You can—and should—rate-shop to compare rates and find the most competitive provider, but don’t necessarily just go with the lowest bidder.
You should choose a policy that will cover the replacement cost of the tiny home itself as well as any contents and any other buildings on your property. Liability coverage can help you recover if your tiny home or its contents are stolen or damaged or if someone is hurt on your property. And, as just mentioned, trip endorsement policies are needed if you plan on moving your tiny home.
According to Treehugger, a sustainability website, tiny home insurance will cost you an average of $600 per year—though that will of course vary based on the value of your tiny home, if you need to cover a moving tiny home, your location and other factors.
You likely have your own unique reasons for owning a tiny home, but now it’s time to protect it. Once your tiny home is insured, you can relax and enjoy the journey—whether that’s a literal journey or simply the adventure of owning a tiny home.