Why Should You Require Renter’s Insurance?
In most cases, it’s a good idea for landlords to require renter’s insurance. This way, you’re not held liable if your tenant’s possessions are damaged or stolen.
In order to alleviate any concerns, you as the landlord can make the renter’s insurance a necessary condition of renting your property. You can also ask your tenant to provide proof of insurance within a few days from when they signed the lease. Purchasing renter’s insurance is a sensible expense that gives everyone peace of mind. Furthermore, it's actually inexpensive and easy to obtain a policy.
The biggest benefit of asking a tenant to buy renter’s insurance is to limit your liability as a landlord if their possessions are damaged or stolen. For example, in case of a fire, even if the tenant is not at fault, homeowner's insurance does not include the tenant's personal property in the policy. If they have no other recourse, the tenant may try to hold you liable for damages. Requiring renter’s insurance eliminates this possibility. It also lets you focus on making repairs instead of dealing with potential lawsuits.
Renter’s insurance protects your tenants against theft. If something of value is stolen, your tenant may have less financial resources with which to pay the rent. Having renter’s insurance allows them to be compensated for their loss, ensuring their financial loss is not passed onto you in the form of withheld rent.
To sum up, renter’s insurance gives everyone peace of mind and can improve landlord-tenant relationships.