Renters insurance: Additionally insured or additional insurer?
I am currently re-writing my lease and rental agreements. One of the additions is renters will be required to have renters insurance. Now do I have them list me as Additionally Insured or just Additional Interest? I have done some research:
Definitions:
Additional interest - The designation is designed to ensure that a third party (the property owner in this scenario) is notified should the policy cancel or non-renew. This endorsement does not convey any coverage to the additional interest nor cost the tenant any additional premium.
Additional Insured - a party listed on an insurance policy that has some type of liability interest in the property. The “Additional Insured” has absolutely no right or authority to make any policy changes or to cancel the policy. Also, contrary to popular belief, an “Additional Insured” is ONLY afforded liability protection under the liability portion of the policy and there is no coverage whatsoever for physical losses resulting from such things as vandalism, theft, fire, wind and hail, and so on.
A PM trainer by the name of Judy Cook had some interesting points: Yet it seemed to be more beneficial for the PM company to be listed as Additionally Insured so to help focus on accomplishing the task of defending against a tenant suit.
http://judycook.biz/additional-insured-vs-addition...
So additionally insured seems great for commercial property, commercial business, endeavors but could be confusing for Landlords. Which is why I am turning to BP members. I haven't found any really great definitions for additionally insured, just examples. For instance it means if the tenant is at fault for a fire (let's assume a fire) then the renters liability would cover the renters belongings but the check would be in the name of the renter and the landlord. If that is the only benefit what benefit is that to me?
Let me know what you do as a landlord and/or property investor. Oh, and yes I did read BP member DREW SYGIT article 3 Common Mistakes Landlords Make ... and Trey Dulling 6 tips to protect newbie Landlords. Both good articles but not enough info on insurance, that was not a dig as the articles were not specifically written to explain the differences between additionally insured and additional interest.