Renter’s insurance is secured by and paid for by your tenants and covers losses to the tenant’s personal or business property as a result of fire, theft, water damage, or other loss. As a rental property owner, you benefit from renter’s insurance because it covers any claims in the event that the tenant starts a fire or flood. The tenant’s premiums go up rather than yours. This tenants insurance is in addition to the insurance for rental property discussed here: http://www.buyingrentalproperty.org/rental-property-insurance/Most commercial tenants have this coverage, but residential tenants often think they don’t need renter’s insurance because they have few valuables. But renter’s insurance covers much more than just their personal possessions; it also protects against liability claims made by injured guests or visitors. The insurance also offers supplemental living expenses if the rental unit becomes uninhabitable due to fire or smoke damage. And it protects the tenant in the event that the tenant causes damage to another tenant’s property. You can suggest or even require that your tenants carry rental insurance, but be aware that in some areas your competitors may not follow your lead and you may find that you’d have trouble keeping your rentals occupied if you insisted that your tenants carry renter’s insurance.
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