LANDLORD INSURANCE INFORMATION
Do you have the right Landlord Insurance to protect you and everything you own???
Maybe your tenant lights a candle and accidentally sets a room on fire. Who pays for the new drywall, new carpet, painting, cleaning, and replacement of furniture that has turned to ash?
What happens if a burglar breaks into the house and steals the tenant's TV, computer, jewelry and money? Who is responsible, and for what??
LANDLORD INSURANCE IS NOT included in any monthly dues you pay to an association!!! Many Landlords mistakenly believe they are insured, because they pay large sums of money each month through their association dues which says it covers insurance. This does NOT cover ANYTHING INSIDE your property!! It covers ONLY common roofs and exterior walls if you're lucky... a common pipe in an exterior wall! But beyond that? Usually not even windows blown out by a hurricane!! It all depends on your association insurance coverage.
So... can you require a tenant to buy Renter's Insurance? NO, IT IS NOT A REQUIREMENT. YOU CAN ONLY ADVISE THEM TO GET IT. Shouldn't they be responsible for insuring anything they own in the property where they live? Unfortunately, there's no obligation for a tenant to do so. Only one in about every ten tenants actually buys this type of insurance. Which means they are risking all of their personal property to theft, fire, flood, windstorm etc. Landlord's insurance will NOT cover any items inside the condo belonging to the tenant. It's a risk tenants MAY take... There is no law requiring them to take out an insurance policy for their protection.
As well, there is no law requiring that LANDLORDS buy a Landlord Insurance policy protecting them from hazards or liability that can occur inside their property. So while your condo insurance will cover the outside walls to be rebuilt after a huge cataclysmic storm... there would be no protection from a slip and fall by your tenant or their guests or fire. Did you know? Often fires simply start behind the walls from an electrical issue of some sort. What happens then? Landlords can get sued.
So while there is no legal obligation for Landlords (or tenants) to buy additional Landlord Insurance or Tenant Insurance for renting... it is highly recommended. LANDLORDS... INSURANCE POLICIES WOULD BE AN EXPENSE AND THEREFORE COULD BE A TAX DEDUCTION* (check with your tax accountant to be sure).
You'll probably want your policy to cover:
1) Property Damage
3) Lost rental income
LANDLORD LIABILITY INSURANCE can be purchased from most large companies including Allstate, State Farm, Nationwide etc. Look over each proposed policy and make sure you have the RIGHT protection. Policies will vary depending on location of rental property, and risks associated with that property. Make sure you are covered for natural disasters, fire, theft etc. as well as legal and personal liability.
Shop around..... With most of the large insurance companies offering such policies... you should be able to find a good policy to fit your needs while not spending a ton of money for your peace of mind.
LANDLORD INSURANCE INFORMATION