Should I Require Renter's Insurance?

[Jonathan Leake]

Hello,

I was thinking about requiring renter's insurance as part of my lease. But now that I am looking over the lease documents and there is this section already in there: 

"All personal property placed in the leased premises, or in any other part of the building, or any place appurtenant thereto, or in
any vehicle on or about the premises or on any parking facility maintained by Lessor for Lessee shall be at the sole risk of Lessee
or the parties owning same, and Lessor shall in no event be liable for the loss of property of any kind, which may be lost or
stolen, damaged or destroyed by fire, water, steam, defective refrigeration, or otherwise, while on the leased premises or in any
storage spaces in the building. Lessee understands and agrees that it shall be Lessee's obligation to insure this personal property
and Lessor recommends that Lessee obtain renter's insurance."

Now, obviously there is what's written and then there's what's actually legally binding and defensible. So for all the legal and insurance people out there, is this paragraph good enough to protect my interests or should I still be requiring renter's insurance?

Best,

Jon

[Nathan Gesner]

A couple thoughts:

1. If you require it, you should require the tenant to add you as "additional insured" on the policy. This doesn't cost anything extra, but it adds another layer of protection for you under their policy (only for liability coverage) and it enables you to track the policy. You will be notified any time the tenant cancels their policy, changes it, renews it, lapses in payments, etc.

2. You have to be willing to enforce it, and that's hard to do. If the Tenant cancels their insurance two days after moving in, what are you going to do about it? What can you do about it?

I never required it because I didn't want the administrative burden of tracking / enforcing. I fixed that by getting a Master Insurance policy that provides renter's insurance for every rental I manage. Tenants are charged as part of their rent and automatically enrolled the day their lease starts. So much easier!