Investment Property Owners: Protect Yourself by Encouraging Your Tenants to Get Renters Insurance
Aprilyn Chavez Geissler
Contrary to popular belief, renters insurance covers more than just your tenant’s personal property. It protects you, the landlord! Did you know that their insurance policy provides recourse for you and your insurance company if your tenant damages your property? Yes, your tenant’s renters insurance policy will replace their personal property so there’s no discussion about you being responsible for their damaged clothes and furniture. In addition, this policy can pay for the tenant and their family to live somewhere else while the damaged residence is fixed.
What if they burn down the neighbor’s house too? This way the neighbor also has recourse to litigate against the tenant and not you. If a tenant doesn’t have assets then there is nothing to collect but if the a renters insurance policy is in place the liability insurance kicks in up to the stated limit (i.e. $100,000 or $300,000). Renters insurance is inexpensive and well worth the price. Be aware, some insurance companies sell policies that only insure of the renter’s personal property other companies only cover liability and not the personal property. The best way for you as a landlord to make sure the policy is adequate and that they have purchased insurance is to ask for a copy of their policy. You have every right to request that your tenants get coverage and you can even ask to be listed as an ‘additional insured’ or ‘certificate holder’. You as the landlord can also require that they purchase renters insurance as part of the contract they sign. This is your investment; protect it in case of a future loss.