How do I insure my ADU in California?
Broadly speaking, it depends primarily on whether your ADU is part of the structure of your primary dwelling, and secondarily on whether you're renting it out. The exact way your insurance situation breaks down will depend on where in California you live and who your insurer is. It's also important to note that an inspection of the property may be required to ensure your ADU qualifies for coverage and will be properly covered.
- If your ADU is attached to your home: It can be insured on your current homeowners policy, even if you or your family don't live in the ADU itself, and even if you rent it out. This can be done by contacting your insurance agent and amending your existing insurance to cover the new 2nd unit.
- If your ADU is not attached to your home, but a blood relative resides in it: It can still be insured under your dwelling coverage, even if your relative pays you rent. Like an attached ADU, you would contact your insurance agent and amend your existing homeowners insurance to ensure adequate coverage.
- If your ADU is not attached to your home, and you rent it to a non-relative: In this case, your ADU would typically be insured with a separate rental dwelling policy, at its own address. This would insure you for potential losses related to renting out a property, like liability coverage or damage to your furnishings.
If your ADU is inhabited by a family member or relative, make sure their personal belongings are covered—depending on the situation, it's possible they'll need renters insurance. Check with your agent to make sure your coverages meet your needs.