Rental Property Liability Insurance might just be a landlord's best friend.
Who pays for the new drywall, new carpet, painting, cleaning, smoke remediation?
What about the tenant's clothes, furniture, personal belongings?
What happens if a burglar breaks into the property through the back, smashing your gorgeous French doors... and steals the tenant's TV, computer, jewelry and money? Who is responsible, and for what??
What if a tenant slips and falls while putting up hurricane shutters. Who is liable?
Remember, anyone can be sued for anything. Even if there are no legal grounds, you will shell out money on attorney hourly rates and time away from work and aggravation.
Depending on the circumstance, your lease, and the law... you could either be held liable, or still have to pay attorneys fees to defend yourself even if you aren't.
A rental property liability insurance policy IS NOT a legal requirement, and it is NOT included in any monthly dues you may be paying to an association!!!
Many Landlords mistakenly believe they are insured, because they pay large sums of money each month through their association dues.
This does NOT cover anything inside your property!! It covers common roofs and exterior walls and if you're lucky... a common pipe in an exterior wall! But beyond that? Usually not even windows blown out by a hurricane!!
Does your lease specify who is responsible for acts of nature, neglect, misuse? Is it strong enough to withstand a lawsuit?
Does your current Management company know these answers???
What about your tenants. Can you require them to buy a Renter's Insurance policy?
Shouldn't they be responsible for insuring anything they own in the property where they live, and be responsible for their own behavior or accidents?
Unfortunately, there's equally no legal requirement for a tenant to have a Renter's Insurance policy. Only one in about every ten tenants actually buys this type of insurance. Learn more about Renter's Insurance policies and how getting your tenants to purchase a policy is a great idea. Renter's insurance policies are generally incredibly inexpensive... like... the amount of a large pizza for an entire month of coverage! There are many ways to inform and encourage your tenants about these policies, even if you don't require your tenants to provide proof that they have one.
It's important to do your research... companies offering landlord insurance include:
So while there is no legal obligation for Landlords OR Tenants
to buy insurance, it is highly recommended.
Remember: a RENTAL PROPERTY LIABILITY INSURANCE POLICY
WOULD BE AN EXPENSE AND THEREFORE COULD BE A TAX DEDUCTION
(always check with your tax preparer).
RENTAL PROPERTY LIABILITY INSURANCE can be purchased from most large companies including Allstate, State Farm, MetLife, 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
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.