Are you a landlord or property owner? Do you rent out space to tenants? If so, do you require your tenants to have their own tenant insurance? If your answer is no, then Insurego has some important information to share with you.
Why requiring Tenant Insurance is important to protect your investment
With each space you rent out, you take on more risk. A risk could be that the tenant will not leave your space in the same condition it was when they got it, or your risk could be that they accidentally burn the place down or cause very expensive damage to your property.
And while accidents happen, whether intentional, unintentional or just stupidity, your renter’s actions could cost you thousands of dollars to repair.
For example; your tenant starts a fire in the kitchen when they are cooking dinner for their date.
Maybe your tenant throws a party and one of their friends who is smoking on the patio puts their cigarette butt out in a flower pot. The flower pot smolders before engulfing the wood deck in flames, eventually spreading to the siding of your house and your neighbour’s house.
What happens if your tenant leaves for the weekend but accidentally leaves a kitchen tap on, or the toilet overflows and floods the space, and possibly the apartment below them.
Whatever the case may be, these damages need to be repaired. As a landlord, your property insurance will probably cover some of the damages to the building (up to your limit) but if you try going after your tenant for damages, what are the chances you’ll be able to recover everything owed?
If your renters have tenant insurance, this can protect your insurance rates from increasing and can cause very little, if any at all, impact on your premiums.
Why tenant insurance also protects your tenants
Landlords should explain the importance of renters to have tenant insurance. Most tenants just assume that their landlord has insurance and therefore they are protected. Unfortunately for tenants, a landlord’s insurance will not protect their personal belongings or offer them legal protection in the event they are sued. Your insurance covers the building while everything inside the four walls is the renter’s responsibility.
If your tenants have tenant insurance, this will protect their personal belongings if there is a robbery in the building, or there is a loss due to fire, sewer backup or other damage. Tenant insurance also includes additional living expenses for out of pocket expenses like accommodations, food and moving expenses if they need to leave their home while repairs are being done.
Why requiring tenant insurance could help eliminate unreliable tenants
When a landlord requires tenant insurance as a condition to rent space in their building, they can potentially lower their risk of having unreliable tenants.
If a landlord senses a potential tenant’s hesitation to purchasing tenant insurance, this could be an indication that they may also struggle with covering rent and other costs associated with the building.
The thing to stress to your tenants is that tenant insurance is affordable peace of mind, not only for the tenant but for you as the landlord. Tenant insurance ensures that your renters’ personal belongings are protected, just as much as you want to keep your building protected. You certainly wouldn’t drive a car without insurance or your own home without home insurance. So as a landlord, you should ensure that your renters protect themselves and possessions.
With Insurego, we have a quick and easy way for you to set your renters up with tenant insurance and they can do it all online! It will save them time, secure their stuff, and save them money! https://insurego.ca/tenant-insurance
*Please note, this article is not intended to be advice. The best advice this blog will give is to call your Broker for advice.