Renters Insurance. So with all the insurance you have, do your renters need insurance? Absolutely. Landlord insurance covers the owner’s property. It does not include coverage for the contents brought to the property by the renters. A basic rental policy covers between $20,000 and $30,000 worth of goods. But you can buy more than that if needed.
This article is part 2 of the article “Doesn’t My Insurance Cover That? In this article, we talk specifically about Renters Insurance. Click here for Part 1 of the article.
What to look for in Renters Insurance. According to Reid, there are three things a tenant should look for in a Rental Insurance policy.
- Coverage for the contents of the rental. The tenant’s possessions are not covered by the landlord policy (dwelling insurance). Rental insurance protects the renter’s own property.
- A renter needs coverage for “loss of use.” If the unit cannot be occupied, insurance will cover temporary housing for the tenant.
- Liability coverage. In the event of a loss, the landlord’s insurance policy will cover the rental dwelling, but the landlord’s insurance company has the right to sue the tenant for damages. A renter’s insurance policy will cover this liability exposure. Proof of renters insurance should be furnished to the landlord by the tenant. Our current lease agreement requires tenants to have insurance.
Renters need insurance for various risks – a fire, a theft or water damage. Tenants should discuss replacement value of property with their agent. When tenants have to replace furniture or other belongings, chances are the replacements will cost more than expected. It’s a good idea for tenants to keep an inventory list so that there is an accurate account of what the tenant owns. And when discussing renters insurance with an agent, tenants should mention any items of value that should be insured separately at a specific dollar amount.
For more information on our management agreement and insurance needs, give us a call at 240–292-1040.