Why do you think you should require your tenants be insured?

[Jack Smith]

So whether you are renting to families, individuals or businesses, it's important as a property owner to require your tenants carry liability insurance. Why you might ask?

Well there are several reasons for this. A simple one is to help protect your assets from the risk of lawsuit. An easy example of this is that your tenant owns a dog know to you to bite and you did not try to have the dog removed. The dog bites a visitor to your apartment building. The tenant carries no renters insurance (which includes liability coverage). So, the injured party sues the landlord as well as the dog owner. The courts will decide what happens, and this varies by state,  but had your tenant carried insurance, they would likely absorb most of the claim, if not all of it.

Second example. Your business tenant with whom you have a lease agreement, and it requires you be named as an additional insured on their commercial general liability policy, has a slip and fall accident in their store. The customer who slipped and fell files suite against you as the landlord. Since your lease requires the (business) tenant carry a commercial general liability  insurance policy , and that it names you as an additional insured on a primary and non contributory basis, you tender the suit to your insurance policy and that of your tenant. The tenants policy will respond for you, so as not to adversely affect your policy, in most cases.

While I'm not an attorney, nor play one on TV and this is not legal advise. It is good sound practice. Additionally, many insurance companies who provide insurance to landlords require written lease agreements, no smoking requirements, liability insurance from the tenants and many prefer a no animal building.

Questions?