Landlords Require Renters Insurance – Becoming The Norm?

Renters of houses, townhomes, condos and apartments will need to become accustomed to purchasing Renters Insurance.

Renters Insurance AgreementIt is becoming increasingly common for there to be disputes involving renters, landlords and other tenants due to the negligence of one or more of the parties involved.    In so many cases,  landlords have been bearing the costs of repairs following a dispute involving a tenant, eventually vacating a property leaving a damaged rental unit.

Today, it is becoming commonplace for landlords not to hand over the keys to a rental unit without first being offered ‘Proof Of Insurance’ showing an in force Renters Insurance Policy and in most cases listing the Landlord as an ‘Additional Insured’ on the policy.

Property Insurance rates have been on a steady rise; apartment owners have seen rapid rate increases due to higher exposure to fire, slip & fall incidents and assaults. In order to combat higher insurance premium, policyholders have been taking on higher deductibles to decrease premium.

Property owners are requiring tenants to bear more responsibility in the tenancy agreement.  A leading renters insurance company, Stillwater Insurance Group, has revealed a self service online quote and buy platform for renters to simply obtain a free quote and buy insurance directly online.

The Stillwater Renters Insurance program allows apartment owners and managers to track more easily who has discontinued insurance. It is estimated that approximately 80 million people in the United States live in rental properties and more than two-thirds of them don’t have renters insurance.

With certainty, a landlord’s policy will not assure coverage for the Personal Property or Personal Liability exposure of a tenant; this is the reason that the Renters Insurance Form exists.   The Renters Insurance Policy simply offers to main parts, Personal/Family Liability and Contents coverage.  There may be some available endorsements for additional exposure but these are not commonly sought after by tenants.

The Personal Liability section covers incidents involving injuries should the tenant be held liable, this form will also cover the tenant in the event of a lawsuit by the landlord for damage to the unit caused by the tenant’s negligence.

Personal Property – Contents Coverage will afford insurance to repair or replace personal property including furniture, appliances, clothing and typically a very small limit on jewelry.  As with most other forms of insurance, renters insurance doesn’t afford coverage from the perils of earthquake and flood.

The average cost of renters insurance is $13 a month, or $156 a year, for about $20,000 of property coverage and $100,000 of liability coverage, with a deductible of $500, this simple guideline varies in all States and geographic areas based on current rates filed with the respective Department of Insurance.

Renters are generally not opposed to the idea of renters insurance, however, many renters are opposed to being required to purchase insurance.   Realistically, this requirement to provide an inexpensive policy of protection for the tenant’s personal property and personal liability is an excellent way to assure that if there are any future issues, they will be resolved amicably by the insurance company rather than in the court system.  It is also evident that without insurance, property owners will increase rent in order to accommodate the increased risk of unrepaired damage to their property.

Renters can browse the Web site of Stillwater Insurance to get free rate quotes. Price should not be the primary determining factor; however, for those who only wish to purchase renters insurance due to the requirement, minimum coverage and maximum deductible will offer the lowest rate.