Why It Makes Sense To Require Renter’s Insurance
Asking your tenants to get renters insurance is a decision that you will never regret. In recent days, most experienced Los Angeles landlords are now ask their tenants to get renters insurance. Simply put, there are plenty of benefits that come with it. Getting this type of insurance will not only benefit the tenant but you as well. Shrewd landlords insist on it, and with the cost falling on the tenant. There’s simply no downside, and the benefits for the landlord are substantial.
The fact is that most tenants in the San Fernando Valley won’t mind getting renters insurance when they understand the important protections. Most tenants wrongfully assume that they are covered by a landlord’s insurance policy for losses to contents. When they learn that this is not the case, they’re easily motivated to plunk down the small amount needed for protection. As a property manager in Los Angeles, we insist on it to as it adds an extra layer of protection to your lease agreement.
Fortunately, this type of insurance is very affordable. It usually costs less than $20 per month and shouldn’t cost a lot of financial burdens even to the most financially-strapped tenants. Before adding renters insurance to your lease requirement, make sure you speak to your attorney as the laws concerning this vary by state.
Some of the reasons why you need to add renters insurance to your lease include:
- Helps You Stay Out of Court
Many tenants without renters insurance will try to sue landlord when damage occurs to their belongings. Some tenants do this in order to recover part of what they lost. Fortunately, you can avoid this scenario by asking your tenants to get renters insurance. At least, they will be compensated by their insurance company in the event of any damage to their belongings while they are on your property.
- Significantly Reduce Your Responsibility
You will enjoy more peace of mind when your tenants have renters insurance. Take for an example your property is destroyed by fire or other natural disasters. Tenants without renters insurance will look up to you to provide them with a temporary accommodation. This adds to the burden of trying to deal with your damaged property. Whereas if they have insurance and cause a flood, more often then not, their insurance will kick in. You may not have to look to your own, thereby raising your rates possibly.
If your tenants have renters insurance, they can easily pay for their temporary housing. Renters insurance without a doubt will lift some weights off your shoulder.
- Helps You Keep Out Bad Tenants
Tenant screening is not always easy. When you make renters insurance mandatory, it becomes easier to weed out bad tenants. Any tenant who complains he can’t afford the insurance is a red flag and you should avoid doing business with such tenant. Anyone who can’t afford low monthly rates for renters insurance may not have enough money for your monthly rent.
- Covers Your Deductible
This is another good benefit of having this type of insurance. When your tenants don’t have renters insurance, you will continue paying the deductible in case of fire even after your insurance policy paid for the repair costs. When your tenants have renters insurance, the policy will cover your homeowner’s insurance deductible.
- Gives You Peace of Mind
Finally, asking your tenants to get renters insurance is a great way to enjoy peace of mind as a Los Angeles landlord or property manager. It limits the possibility of lawsuits and takes off some weight off your shoulder. Moreover, this type of insurance will improve your relationship with your tenants since you are not seeing them as a prospective litigant. And they won’t see you as a potentially fat payday if things go awry.