Everything you need to know about insurance basics, like coverage types, limits, cost and more.
Why Your Tenants Need Renters Insurance
Most renters are unaware of the benefits of having renters insurance, and there are many who believe that the landlord’s insurance will cover them in the event of a loss. Help your tenants by encouraging them to protect their belongings with renters insurance.
What Does Renters Insurance Cover?
Personal property. Many renters probably don’t have enough money on hand to replace their clothing, jewelry, electronics, furniture and other personal possessions should they suddenly be destroyed — and landlord's insurance won’t cover these items. Renter’s insurance is an affordable coverage your tenant can add to protect their belongings and give them peace of mind.
Liability. Renter's insurance compensates an insured up to the policy limit if he or she is legally liable for bodily injury, property damage or medical expenses due to a covered accident.
5 Reasons to Encourage Your Tenants to Get Renters Insurance
Eliminates headaches. Contrary to what many renters believe, landlord's insurance does not cover a renter's belongings. By encouraging your tenants to get renters insurance, you could be helping avoid some legal problems down the road.
Reduces liability exposure. Unintentional fire is the No. 1 claim, and if a tenant is liable, their renter's policy will cover the loss up to the policy limit.
May lower premiums. Fewer losses paid under a commercial policy can equate to lower premiums.
May cover additional tenant living expenses. The business owner’s policy will not pay for a tenant's additional living expenses should a fire or water damage from a next door apartment force the tenant out.
Attracts better tenants. Renters insurance creates tenant awareness and responsibility, ultimately making them better tenants.
Consider Making Renters Insurance a Requirement
There are a number of benefits to requiring your tenants to have renters insurance, but mostly, it takes a load off your shoulders. When your tenants have their own renters insurance, there’s less risk of you being held responsible for potential lawsuits or legal fees for issues they might try to claim are your responsibility.
Some property management companies have added language to their lease agreements requiring tenants to purchase liability insurance, and their tenants must show proof of insurance to obtain the apartment keys.
By educating your tenants on the benefits of renters insurance, you can help them (and yourself!) save a lot of headaches down the road. Check out some renters FAQs to clear up common questions you or your tenants may have, and gain peace of mind knowing you’re both protecting what matters most. Keep in mind, an American Family Insurance agent is always a good resource for you.