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08 Jul Requiring Renters to Have Insurance
It seems the trend in the industry is requiring renters to have renters insurance when they move in. I would like to go over why renters insurance is starting to be required. Also review the standard way about getting that certificate of insurance, in addition giving you some other options to get the same results.
Benefits of requiring renters insurance, and why most are, it provides a buffer of $100,000 – $300,000 in property damage from tenant caused fires or floods. Meaning you don’t have to claim the damages from a renters grease fire on your property policy, or pay out of your own pocket for the damages. Claiming anything on your insurance is going to make your rates go up, right? Why should you be punished for something the renter did?
What I believe to be the “standard way” of requiring insurance is having the renter contact a local agent/broker that provides renters insurance through the admitted market (State Farm, Farmers, All State, etc.) The renter works one-on-one with the agent/broker purchases the policy (pays in full, or finances) gives the property manager a copy of the certificate of insurance. Why do you want a copy of the certificate? It shows proof the renter actual got the coverage. NOTE: If you go this route you want to make sure you are listed as an additional insured on the renter’s policy. Taking this route will be a lot of tracking of certificates and tracking to make sure renters keep the coverage in place.
There are other options out there to get the same type of coverage you are after as a property owner/manager. I have put together a list of the options I know of available. If I were you I would call all of them and get what you think works best for you and your situations.
Evolution Insurance Brokers – www.eibdirect.com