Which type of policy provides coverage for loss of rent due to a covered hazard?

The type of policy that provides coverage for loss of rent due to a covered hazard is a business owner's policy. This policy is designed to cover a variety of risks associated with operating a business, including physical property damage and liability. One key component is that it often includes coverage for loss of income, which in this case translates to loss of rent when a property cannot be rented out due to damages incurred from a covered hazard, such as a fire or natural disaster.

When a covered event occurs, and the property is rendered uninhabitable or unusable for its intended purpose, the business owner's policy compensates the property owner for the rental income they would have otherwise received. This makes it particularly beneficial for landlords and property investors who rely on rental income to sustain their business operations.

While a multiple peril policy could also provide such coverage, it typically refers to broader insurance options that don't specifically focus on rental income. A rental property policy is more tailored for residential landlords but is not classified as a business owner’s policy, which encompasses various commercial operations. Homeowners insurance primarily covers personal residences and typically does not extend to business-related loss of income. Therefore, in the context of coverage for loss of rent due to a covered hazard, the business owner's policy is the