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Renters Insurance: protects the landlord more than the tenant.

By
Services for Real Estate Pros with Allstate Insurance

Tenants purchase renter policies to protect their "stuff".  Personal property protection is a start to the coverage... but there is much more.  The policy traditionally comes with Liability coverage too.  This is the coverage that protects the Landlord... How?

Here is an example:  In 1989, I purchased my first rental home and in 2004 my tenant burned the home.  The tenant caused the fire accidentially... Simply stated, the candle tipped over and the home burned.  No problem right.  My landlord policy paid and the home is as good as new.... better yet, it is new.  The catch is I'm now stuck with a Major claim.   The story doesn't end there.  My insurance company sued the tenant under a term called "Subrogation".  We, the insurance company and me, wanted to be made whole from the negligence of the tenant.  Two senarios:  1st- the tenant had a rental policy with liability coverage... The liability coverage reimburses my loss and I may even get my deductible check back too.  2nd- The tenant has a lawsuit filed against him/her, has funds garnished or they are forced into bankruptcy.  Me, I'm still short my deductible and a major claim on MY record.

Which senario would you prefer?  Imagine the difficulty of obtaining another home or landlord policy after a major claim... 

So when you represent that owner and rent thier home, consider looking eye to eye with that tenant and state that they must have and maintain a renter's policy.  I'm not saying to put it in writing...    But consider looking out for your owner by putting all of the tools in place to make the renters policy easy to obtain and have you and/or the owner notified if the policy lapses.

Traditionally the little amount of property protection comes automatically with $100,000 of liability protection.  Encourage the tenant to maintain liability coverage of $300.000.  This additional coverage is traditionally only $20.00 extra dollars a year and will position your owner to be well protected from the tenant's negligence.

1-877-MattLocke

 

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