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Why do some landlords require renters insurance?

Why Do Some Landlords Require Renters InsuranceLandlords may require you to obtain renters insurance for a few reasons. Renters insurance is a type of insurance policy that provides protection against a renters loss of personal property.

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Renters insurance also covers the additional cost of living expenses, damages, and medical bills that you, or a guest, may sustain while in your place of residence. Renters insurance does not cover property owned by the landlord, such as structures and appliances, unless they are owned by the tenant.

The insurance typically covers the renters personal property loss due to the renters own negligence or circumstances that were out of the renters control.

How does renters insurance protect my landlord?

In order to understand why a landlord wants you to have this coverage you need to know what renters insurance covers.

The main reason a landlord will require renters insurance is to provide themselves with legal protection.

This safeguards the landlord from lawsuits to recover damages, loss, or injuries that are incurred by you, other tenants, or guests. Requiring tenants to hold renters insurance policies prevents landlords from having to pay out of pocket should something happen to you or your personal property if you are not covered.

necessary renters insuranceAnother reason a landlord will require renters insurance is to reduce the costs of their own liability coverage and insurance premiums. This is a way for landlords to avoid having to file a claim on your behalf on their own insurance policy. Every claim a landlord files may cause their insurance premiums to go up.

If too many claims are made, over time an insurance carrier may refuse to provide insurance coverage to the landlord. If you have your own property insured, that is one less claim that the landlord will have to submit in the event of a loss.

Who should have renters insurance?

Anyone renting a place they do not own needs this coverage if they cannot afford to replace all their possessions with available funds. Most of us can’t. This coverage protects you, your landlord and others.

When there are multiple tenants involved, requiring renters insurance protects not only the landlord, but it protects the tenants from each other. Damages, loss and theft can be caused by other tenants. The bottom line is that requiring tenants to carry renters insurance inevitably saves landlords money.

Renters insurance is a sound investment if you own even a nominal amount of valuable property. The cost of a renters insurance policy is usually minimal compared to the cost of replacing all of your belongings should they be stolen or if you suffer a loss due to fire, smoke, water, or other types of damage.

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What does renters insurance actually cover?

renters insurance requiredRenters insurance will typically cover your belongings even if they were stolen or damaged away from home. If you factor in the cost of staying somewhere else while your residence is being repaired, renters insurance ensures that these expenses will be one less thing you have to worry about.

Renters insurance usually covers liability as well. This means that if someone hurts themselves while in your place of residence, they would be covered by your renters insurance policy. Typically the landlord’s liability insurance does not cover incidents that occur inside your residence, especially if the injury was caused by something that you own. This protects you from lawsuits and covers all related medical expenses.

Am I required to carry renters insurance?

Some landlords require that tenants hold a renters insurance policy and some do not. Carrying a renters insurance policy is usually not required by law. If you are required by your landlord to hold this type of insurance due to a lease agreement or otherwise, there are a few ways that you can save on the cost of a renters insurance policy.

If you install smoke detectors in your unit, your insurance premium will be lower. If you have dead bolt locks on your exterior doors and/or have a security system in place, your insurance premium will be reduced even more.

Some insurance companies even offer discounts for multiple policies.

For example, if you have automobile insurance with the same insurance company, you might be eligible for a multiple policy discount.

renters insurance required by landlordMake sure that if you purchase a renters insurance policy, you read through it very carefully. Check to make sure that adequate liability coverage is included in the wording of your policy. In addition, some renters insurance policies do not cover damage or loss due to acts of nature such as floods, earthquakes, and other natural disasters.

Renters insurance policy premiums may be significantly higher to cover your property loss in case one of these events occurs. If you live in an area that has experienced one of these events in the past, you may consider purchasing the additional coverage for peace of mind.

If your landlord does require you to carry a renters insurance policy, know that their main priority is to protect themselves. However, requiring you to have renters insurance inadvertently does you a favor as well. You can rest assured that no matter what situation takes place, you, your family, your personal belongings, and your guests will all be taken care of. To find out more about obtaining a renters insurance policy, please use the renters insurance quote tool below.

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