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Madeleine Ho
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House Hacking: Structuring Room Rental Insurance

Madeleine Ho
Posted Dec 29 2022, 11:32

Hey BiggerPockets Community!

I just bought my first primary residence and am hoping to rent out the spare rooms to roommates. Should I require that my renters purchase renter's insurance before signing the lease? And would that interfere with my insurance as I am the only person listed on mine? Would appreciate any advice!

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Nathan Grabau
  • Realtor
  • Longmont, CO
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Nathan Grabau
  • Realtor
  • Longmont, CO
Replied Dec 29 2022, 11:35

Renters insurance does not really impact your insurance policy. Essentially you are adding an extra layer of protection for your tenants, your other tenants, and yourself. I do not require my house hacking tenants to get renters insurance, but I only have friends who I have confidence in living in my properties. Renters insurance is also incredibly inexpensive, like 20 bucks or less a month, so this is not a big ask at all if it helps you sleep better at night. 

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Madeleine Ho
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Madeleine Ho
Replied Dec 29 2022, 11:49

Hey Nathan, thank you for responding! Do I need to add the new tenants under my insurance policy? I will probably have the individual renters get the insurance themselves since they are from facebook.

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John Mocker#1 Insurance Contributor
  • Insurance Agent
  • Norwalk, CT
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John Mocker#1 Insurance Contributor
  • Insurance Agent
  • Norwalk, CT
Replied Dec 29 2022, 12:51

Madeleine,

Normally you would not add the Renters to your policy.  They do not have an interest in the property and you are normally not responsible for their property the bring in.  I've seen it occasionally for a family member (ie. niece or nephew, etc.) that does not qualify as an insured where the owner wants to cover their belongings on the main homeowners policy.  A renters policy is better for you and them because it provides them with Liability and Loss of Use (if they have to live elsewhere such as Hotel if there is a covered loss at the location).

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Madeleine Ho
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Madeleine Ho
Replied Jan 2 2023, 13:08

Thank you! This really clears things up. Appreciate it and happy new year!