These days, more and more landlords are requiring their tenants to have renters’ insurance, and for good reason. This type of insurance is beneficial to both the tenant and the landlord, though it may be a little difficult for the tenant to understand how when they’re only paying attention to the extra bill every month. Even if you don’t require renters’ insurance for the people living at your property, it’s still a good idea to look into the benefits and discuss them with your tenants.
A renters’ policy is good for you as the landlord because it helps ensure your tenants are protected from certain damages, which in turn protects their livelihood. This affects you directly because a tenant dealing with a sudden unexpected expense may in turn not be able to make rent or continue living in your building. Additionally, tenants with renters’ insurance are less likely to sue their landlords over property loss or damage, since the policy should cover and replace their lost property. Depending on the policy, it may lighten the burden on you as far as what you’ll have to pay in the event of theft or natural disaster.
For your tenants, renters’ insurance offers reimbursement and a safety net at a reasonable monthly cost. The average policy costs around $25 a month for $25,000 in coverage, which is often enough for most renters to replace damaged or stolen property. Most policies protect against fire and theft, and some protect against flooding and earthquake damage, as well. Every policy is different, but some bundled packages may also protect your renters against credit card theft, theft off of the premises, and injuries sustained by guests.
The average renter may believe that their personal property is too insignificant to require a policy for replacement, or that the policy will be too expensive. Help mediate these worries by explaining the true cost and benefits of the insurance. They may also believe that your property insurance will cover damage to their property, and you should educate them if this is not the case so that they can make an informed decision.
If you’d like to go over the particulars or discuss renters’ insurance with a property management expert, contact us here at Alliance Property Management. We’ll walk you through all the particulars.