Renter’s insurance protects both tenants and landlords. Your tenants need this insurance so their personal possessions are covered while they live in your property. As a California landlord, you should require that your tenants purchase renter’s insurance while they lease your home. Include this requirement in your lease, and make sure you have the documentation to prove your tenant is covered.
Homeowner’s Insurance and Renters
Homeowner’s insurance covers owner-occupants and their belongings only. Once you begin renting out your property, you need to convert that homeowner’s policy to a landlord policy. It does not cover any liability on behalf of the tenant, nor does it cover their belongings. Tenants need their own insurance so they are protected and their things can be replaced if something happens. The policy you have in place will only cover the structure and systems of the home, as well as the landlord’s liability. If the tenant’s television is stolen during a robbery or books are ruined during a flood, renter’s insurance will be required for those claims.
Renter’s Insurance and What it Covers
This type of insurance is cheap, and most policies cost around $15 per month. It will cover the tenant’s belongings, whether they are lost or damaged. If these things are destroyed during a loss, the tenant will be able to replace anything that was damaged. Have your tenants purchase a policy with at least $100,000 of liability protection. This will protect your tenant if his or her iron accidentally causes a fire or leaving a bathtub running causes water damage.
Adding a Landlord as Additional Interest
Have your tenant add the property manager and your own name as an additional interest. This allows you to receive confirmation that the tenant has the policy in place, and it will let you know when it cancels or renews.
Explain to your tenants the many ways that renter’s insurance benefits them. If you have any questions about insurance requirements and how to protect your property and your tenants, please contact us at Los Angeles Property Management Group.