As a landlord or rental investor, understanding renters insurance benefits is crucial to protecting your property and your tenants’ belongings. Learn about renters insurance and why you should require all of your tenants to have an insurance policy.
Renters insurance is important to landlords, property managers, and tenants alike. It protects the personal property of both the renter and the owner, and helps ensure that any damage to the property can be repaired. It can also alleviate the mental burden of worrying about the ‘what-ifs’ of owning a rental property. Damage to your property, your tenants’ property, and liability related to the tenant can be covered with the right policy.
As a property owner, there are many reasons you may want to require renters insurance. If you own rental properties in a high-crime area, coverage can help ensure that any potential break-ins are covered. Additionally, if you allow pets in your rental property, renters insurance may cover some of the risks associated with it.
Renters insurance is often quite affordable, making it an excellent and easy choice. In most cases, it costs $14 per month, on average. Although the price varies depending on the property, due to this affordability, it is beneficial to encourage or require your tenants to purchase a renters insurance policy.
What does renters insurance cover?
The coverage of a renters insurance policy varies depending on the insurer and policy. According to the National Association of Insurance Commissioners, renters insurance typically covers a tenant’s belongings in the event of an accident or break-in. Should property damage occur to the point of rendering a property uninhabitable, your tenant’s insurance may cover their accommodations and food until it is repaired.
These protections do not extend only to items inside the home; they can also cover cars, damages done by the renter, their children, or the renter’s pets. Renters insurance can also protect from liability or lawsuits if someone is injured on the property.
Coverage of the related medical bills may be another benefit of your insurance policy. If used to cover a pet, renters insurance can cover damage a renter’s pet does to someone else’s property. It can also protect you and your tenant if the pet bites or otherwise injures someone.
What are renters insurance benefits?
Renters insurance has similar benefits to most other forms of insurance: replacement of lost, destroyed, or stolen assets, coverage for the unexpected, and other similar protections. These benefits mean that your tenant can breathe easy without fearing scenarios they cannot control. Additionally, as a landlord, you do not need to worry about your tenants being in these situations.
These tenant protections also mean that you do not need to fear liability for accidents or other damages covered by the renter’s insurance policy. Additionally, the coverage for accommodation in the event of severe property damage can relieve a major concern. Many tenants wrongly assume their landlord or landlord’s insurance will cover housing or damages to tenant property in the event of a break-in or disaster. This misconception leaves tenants vulnerable and the minimal monthly fee associated with renters insurance could have prevented the issue.
Why should I require renters insurance?
Landlords should require a renters insurance policy because it protects everyone involved. It is inexpensive and can be lowered if the tenant bundles with their car or other insurance policies. The benefits are extremely helpful in the event of unexpected damage, tenant negligence or liability. If a tenant leaves the tap on and floods the apartment and subsequently the lower floors beneath them, most tenants cannot be relied upon to cover those expenses. Renters insurance guarantees that your property will have those expenses covered.
Requiring renters insurance ensures peace of mind to all parties. Overall, a renters insurance policy, in addition to your own landlord insurance, is one of the best ways to reduce the stress and worries of being a landlord.
Learn more: Why Should I Require My Tenants to Have Renters Insurance?
Final Thoughts:
Requiring a renters insurance policy is an excellent way to protect yourself and your tenants. It protects both parties from expenses related to damage to their property, protects them from liability in the event of injuries or damages to others’ property, and provides accommodation when needed due to damage. With all of these benefits in mind, you can protect yourself, your property, and your tenants with a renters insurance policy requirement.
