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Renters Insurance: How do you explain it to the tenant?
Good afternoon,
I am renting out my first property and it seems like it is important for me to require renters insurance from the tenant.
What would you say to a tenant as to why having renters insurance is a benefit to them? Or what does it protect them from?
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- Rental Property Investor
- SE Michigan
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Easy peasy. Here are a number of things you could say. (FWIW, be sure you have them add you or your entity as additionally insured. That way if they cause a loss, their insurance covers your deductible. Also, you get notified if they cancel the insurance.
1) Because it is a requirement In other words, you cannot rent this unit if you don't have insurance.
2) As a landlord, our insurance does not cover your items. Your insurance covers your stuff. If there was an issue, such as a fire, wouldn't you want all new stuff?
3) If there is a major issue at the property such that nobody can live there, it is expensive to move and you need time to find a place. Insurance will usually put you up on a hotel for a few days to get settled.