Renters insurance keeps potential problems at bay and tenants happy and protected. Here are three reasons you should require it in your leases.
#1: No Lawsuits? No Problem
If something happens to your tenants’ property or visitors, you can be held liable. Say, for instance, there’s a leak in the building, and a tenant’s property is damaged. Without renters insurance, they can file a claim against you to replace the belongings and then some.
Even if your landlord’s insurance company agrees to pay for it, you will likely have higher premiums that will continue to increase with every claim.
If your tenants had renters insurance in this scenario, you wouldn’t have been a part of it. In other words, you’re free of liability, because their policy will cover it. It saves you time, plenty of money, and a lot of potential headaches and difficult situations.
#2: Reduces Responsibility and Draws Responsible Tenants
The same way that renters insurance frees you from lawsuit and claim liability, it also reduces your responsibility for other incidents as well.
Whether it’s legally required in your state or demanded by your tenant, you may be held responsible for your tenant’s living situation if something happens to the residence. For instance, if a fire makes the space unlivable, you may have to find and pay for their temporary living situation while repairs are made. But, if they had renters insurance, all of this would be covered without any responsibility to figure it out on your part.
Renters insurance can also draw in more responsible tenants. If they cannot afford the monthly premium, they may not be able to pay rent consistently. With an average $20 or less premium, it should fit within their budget.
Many tenants have renters insurance for their own benefit. If a tenant can’t afford that small, additional cost or simply doesn’t care, it may be in your best interest to continue looking for another applicant.
#3: Renters Insurance Covers Your Deductible
If your tenant experiences property damage, your landlord insurance policy may have to cover repair costs. While you’ll benefit from this coverage, you will have to pay your deductible. This can be a substantial amount of money, especially depending on the type of damage and how much coverage you’ll need to repair it.
But, if the tenant has renters insurance, the policy will likely cover your deductible. Not only does this relieve a huge financial burden off your shoulder, but it will also make sure you take full advantage of both your landlord insurance and the tenant’s renters insurance.
Make Renting Easier with Remco
The best way to manage your insurance as a landlord is with expert help. Remco Insurance Services does the hard work for you. To learn more, text us at 267-692-8296, or call 215-357-7878.