How do I tell my tenants that they need to purchase tenant insurance? If you are a landlord and have not yet required your tenants to have insurance, now is a good time to do so. It is good for you and good for your tenants.
Renters insurance letter template Download
But how do you tell your tenants that they must have renter’s insurance? Steve is a landlord in Boise and contacted us because he wanted to start asking his tenants about renters insurance with Idaho. Steve asked if there are specific things he should know before asking for insurance, or if there are situations where he cannot tell his tenants they must have renters insurance. This is a good question, and we should discuss it.
Do I have to tell the tenant that Renters Insurance is mandatory?
Of course, you must. In all 50 U.S. states, landlords generally have the right to include any clause they like in the rental agreement. Nationwide, landlords include quiet hours and penalties for violations in their rental agreements, so there is really no reason not to tell tenants that rental insurance is required. There is an exception, though.
If you are renting to a tenant who is a member of a particular subsidized housing program, you may not be able to claim coverage under the program’s rules. In such cases, you should consult a copy of your scheme documents and/or seek legal advice. Outside of this small group, you may be able to add requirements to your lease when there is a new lease, when it is renewed, or when it is modified by written agreement between the parties.
How do I inform my tenants that renter’s insurance is mandatory?
The best way to inform a tenant that renter’s insurance is mandatory is to write a letter. Whether you are a new tenant or renewing a lease, it is always helpful to point out the changes in the lease and the specific policies and rules that apply to the accommodations you rent to them. As a landlord, what are the benefits of telling tenants that they must have tenant liability insurance? Tenant negligence is the most common cause of damage to rental properties and leases. Fires caused by cooking are the most common example, but damage caused by tenant negligence, such as smoke damage, leaking bath water, etc., are also covered.
Renters insurance letter model
If you have tenant insurance, rather than homeowners insurance, your insurance will cover this. However, the insurance will want to find out who caused the damage in order to recover money for this claim. The tenant may not want that much money. If the insurance company sues the tenant for money the tenant does not have, an unpleasant situation could arise and make it difficult for the tenant to pay you rent.
Allowing the insurance company to intervene in the tenant’s liability policy would have less impact on the tenant and would be a quiet matter between insurance companies. The tenant does not have to pay for subrogation and the tenant’s insurance usually takes care of it. Informing tenants of the need for renters insurance can also provide an escape route in the event of fire or other serious damage. With loss of use insurance, you won’t make the mistake of looking for alternative accommodations. In addition, personal property insurance ensures that your belongings are protected.
How do you communicate to the renter that Renter’s Insurance is required?
You can remind them that their belongings need to be covered as well. You are not responsible for the borrower’s belongings, but some borrowers believe you are. By covering them from day one, you can help clear up any misunderstandings and protect them at the same time.
