When it comes to insurance policies, landlords and property owners tend to have the process down to a science: their building insurance, liability, and other policies are in place. You do this in order to protect your building should something happen. However, none of these policies protect your tenants and their belongings. It’s standard for building insurance and other options to only cover the communal areas, exterior parts of the structure, and the plumbing, not the items in each tenant’s apartment. This is typically handled by renters’ insurance.
Wondering if renters’ insurance is necessary? Here are a few important reasons why you should require your tenants to have their own policies.
It Shows Responsibility
Every landlord wants responsible tenants, especially those that will take care of the property, keeping it nice. Tenants who have renters’ insurance are more likely to do so. The insurance policy shows that not only do the renters have good enough credit for one, but that they understand the importance of having something in place, just in case something should happen. These responsible tenants are the best kind to have.
It Prevents Lawsuits
What happens when your rental property ends up catching on fire or loses its roof in a high windstorm? Yes, your building insurance will help you rebuild, but what about your tenant’s belongings? Their rental insurance will pay to replace any furniture or other items that get damaged, but if they don’t have a policy in place, they may sue you and your management company in order to recoup any losses. Ensuring that they have a renters’ insurance policy will prevent this.
It Gives Your Tenants Peace of Mind
Peace of mind goes a long way towards lowering stress and anxiety levels. This in turn leads to happier renters. They’ll be more likely to be friendly with their neighbors, take care of the property, and be the upstanding tenants that you want them all to be. There’s just something peaceful about knowing that you have insurance in place should the unthinkable happen to your personal belongings, like clothing and furniture. And all it takes is a rental insurance policy.
It Covers Things Your Policies Do Not
You’re aware of the limitations of your business, building, and liability insurance, but your tenants may not be. Whether they’re first-time renters or those who simply don’t know that things like renters’ insurance exist, it’s important to inform them. They may not know that your insurance only covers the exterior of the building, any common areas, the plumbing, and the grounds. They might believe that their belongings are covered by your insurance policies. By telling them that they need renters’ insurance, you’re also informing them of what it will cover and why it’s important to have this type of policy.
Have Questions? Contact Charlotte Insurance
Want to learn more about renters’ insurance for tenants or rental property owners? Contact Charlotte Insurance. Our agents can explore and explain all available options and put together the insurance coverage plan your business needs.