Renters Insurance Covers More Than Just Tenants
Studies have shown that while 96% of homeowners maintain homeowners insurance, less than half of renting tenants have a renters’ insurance policy. While many tenants feel that renters insurance may be another hurdle on the financial track towards residency, a large number of renters discover through a painstaking experience that not securing this coverage is a much bigger problem.
The common misconception assumed by many tenants who begin leasing a property or apartment is that they too will be compensated by the landlords’ insurance policy in the unlikely event that their residence is damaged or destroyed. This could not be farther from the truth. The fact of the matter is that the property insurance is limited to the physical attributes of the building, such as the structure itself. These dwelling policies will not provide compensation for any of the tenants’ personal belongings. In order to receive reimbursement for any ruined furniture, clothes or jewelry; the resident leasing the premises must maintain a renters’ insurance policy.
Considering the frequency of fires which occur at homes throughout the United States it seems more than sensible to prepare for the unexpected. In an NFPA report last year, it was determined that U.S. fire departments responded to an estimated 1.3 million fires which resulted over $12 Billion in direct property loss. After the occurrence of a devastating event such as a home fire, it is crippling to think that a tenant could potentially lose all of their personal belongings and be left with nothing to help them get back on their feet.
Although there is such a high dollar amount associated with property loss due to fires, renters coverage against such perils is not financially burdensome. Basic renters’ insurance policies provide $30,000 in personal property coverage and start as low as $100 for the entire year. Broken out over a 12 month lease, a renter would essentially be paying an additional $8.33 for the confidence that they will be covered.
Renters’ Insurance coverage doesn’t just provide peace of mind for the tenant, but the landlord as well. In fact, many property owners are now making renters insurance a requirement in the lease due to the affordability as well as the additional protection that is provided to the landlord. By requiring residents to maintain renters’ insurance, much of the liability for injuries can be shifted away from the landlord.
Liability coverage is a huge concern for landlords and is a large portion of the coverage provided with a tenant occupied dwelling insurance policy. Because renters’ insurance also provides liability coverage, insurance companies may provide discounts on the dwelling insurance policy if the current tenant maintains an adequate level of liability coverage. Additionally, there are multiple scenarios where requiring leaseholders to have renters’ insurance can save landlord’s money in the long run.
If a landlord accepts dogs at a rental property, a substantial risk arises. If the tenants’ dog bites a neighbor or visitor, the property owner may very well get sued. By requiring renters to maintain liability coverage and name the landlord as additionally insured, the liability can be assumed by the renters’ insurance policy. Although a landlord may be protected by the liability coverage of their own dwelling insurance policy, filling claims generally do not go without repercussions. Insurance premiums almost always increase when there is a loss history.
It is highly advisable for tenants to carry renters’ both for the sake of their property and for the benefit of the landlord. While it isn’t required by law or by lender like most property & casualty insurance lines, it can become a requirement of a lease. By instituting mandatory renters’ insurance as a requirement of a leasing contract, property owners are able to provide financial protection for not only themselves but also their tenants.
Moore Resources is an Independent Insurance Agency located in St. Petersburg, FL and offering Homeowners Insurance, Auto Insurance, Personal Insurance and Business Insurance. Our reach extends beyond the Tampa Bay area to the entire state of Florida. Moore Resources has regionally been dedicated to serving the local residents of Pinellas, Hillsborough, Polk, Pasco, Manatee and Sarasota counties; including St. Pete, Tampa, Clearwater, Bradenton, Brandon, Dunedin, Gulfport, Lakeland, Largo, Lutz, Palm Harbor, Pinellas Park, Riverview, Ruskin, Seffner, Seminole, Temple Terrace, Tierra Verde, Town n Country, and the Gulf Coast Beaches.
Please remember that the purpose of this blog is to present general information only. It does not interpret specific policies or coverage. In order to obtain detailed information regarding your insurance, contact a licensed insurance agent.
