May 28, 2015
Renter’s Insurance… Beyond Liability
It’s a hard fact of the property management business: Too few renters buy insurance.
Most renters underestimate the value of their personal property. They may mistakenly assume that, because their possessions aren’t valuable or their furniture is secondhand, they don’t need coverage. But in the unfortunate event of a grease fire in the stovetop or water damage caused by a neighbour’s leaky sink, renters could face the unhappy experience of having to replace everything they own. And when they do, they’re probably in for a shock when they discover the associated cost.
Beds and mattresses, a television, couch, refrigerator, not to mention entire closets full of clothes – it all adds up. Even the barest of apartments will take thousands of dollars to replenish.
Renter’s insurance is a simple and relatively inexpensive way of protecting against the loss or destruction of possessions, resulting from fire/smoke, vandalism, theft, explosion, windstorm, water damage and other disasters. If the apartment is rendered unlivable, most policies also cover accommodations in a comparable unit, as well as other living expenses, such as meals.
As well, renter’s insurance offers liability coverage, protecting against lawsuits for bodily injury or property damage caused by the resident or their family members. Many policies also include no-fault medical coverage in the event that a visitor is injured in the unit.
In most ways, renter’s insurance is comparable to homeowner’s insurance, except for the cost. It’s usually less expensive because it only covers the renter’s liability and personal belongings inside the unit. The rest of the building falls under the property owner’s policy.
Three Great Reasons to Get Renter’s Insurance
Your residents aren’t the only ones who stand to benefit from renter’s insurance. Property managers also see many advantages. Consider the following:
When residents have insurance, if they have to replace their possessions, they won’t find themselves unable to pay rent. So you can protect your income stream while eliminating the need to chase renters down for money. Not only will you reduce operational expenses and headaches, but you’ll be able to preserve a positive relationship with your residents.
Renter’s insurance also means you can avoid having to make a claim on your own insurance to repair any damage or recover any losses at the fault of your renter. You’ll be able to keep your commercial property insurance premiums to a minimum, and you can avoid having to raise the rent to compensate for those who aren’t insured. Current residents will appreciate the lower rates, and you’ll make a good impression on new renters.
By ensuring that renters have coverage for repairs, to their unit or surrounding units, you protect your building against losses. You also open the door to providing much better customer service.
Property damage is stressful enough for residents. With sufficient liability coverage in place, renters will at least have the comfort of knowing they won’t have to pay out of pocket. And because you won’t have to assume the cost of repairs or replacements, you can focus on helping ensure that maintenance is handled promptly. It makes for a much better experience when the property manager can help ease residents back to life as usual, rather than haggling with them over dollars and damages.
With adequate insurance, renters will be able to cover any loss or damage for which they’re responsible. Without proper coverage, they may find themselves in a tight financial spot. In those cases, many residents try to blame others for the damages so they can avoid financial liability. They may target the property owner for negligence, or the building for faulty wiring or a defective furnace.
Getting into a legal battle with residents is something to avoid at all costs. Not only will it ruin your relationship with the existing renter, it could also damage your reputation with prospective residents. By reducing your risk of legal action, renter’s insurance helps ensure a smoother, far less costly experience – for you and the resident.
Encouraging renters to purchase insurance provides more than protection for you. It offers them sound advice, and shows that you care about their wellbeing.
Our resident insurance integration makes enrollment easy and cost effective for everyone. With access to real-time status on all resident policies, you’ll know exactly which residents have coverage, who has terminated their policy and whose policies are about to expire. Our integrated portal also allows you to monitor policies by other providers and request policy updates directly from residents.
To discover how Property Vista can help you deliver outstanding customer service, sign up for your free account today.