Owner and Renter insured simultaneously?

Question

In Md the state requires renters to provide rental insurance. I'm looking to purchase a MF home in VA in Jan and wondering if it's customary to require renters to obtain insurance as well. Is it overkill or even legal? Thanks!

John Mocker · Answer

Muinda,

Another good reason to require the Tenant to have Renters Insurance is Liability.  If the tenant causes a condition that results in someone getting injured and the they have Renters Insurance, there will be Liability coverage that the injured party can go after.  If there is no Renters Insurance the claimant or their representation will start thinking of reasons why you were responsible (you and your insurance would be the deep pockets then).

Muinda Gueston · Answer

@Christopher Phillips awesome thank for the advice.

Christopher Phillips · Answer

@Muinda Gueston

You can either request proof or emphasize that it's required in writing. So, if there are future problems, you'll be able to point to the fact that you said the insurance was required to cover their personal items...

Christopher Phillips · Answer

@Muinda Gueston

It's not overkill. Landlord insurance coverage would not pay for the loss of the tenant's personal items during a claim.

You can require it and it's a minimal amount of money considering the cost of furniture, computers, and such.

Muinda Gueston · Answer

@Bryan Otteson thank you for the breakdown!

Bryan O. · Answer

@Muinda Gueston where I have seen, it is up to the management/owner to require renter's insurance. There are 2 types of insurance here:

Rental Property Insurance: this is the insurance you will have, typically required by your lender. This will cover the property and often the lost rent in case of disaster

Renter's Insurance: this is the insurance the renter purchases, typically required by the landlord or owner. This will cover the tenant's contents, can pay for a hotel if the home becomes inhabitable, pets, and other things. I require this for my rentals because if something happens that is the tenant's fault, their policy is the first line of defense instead of mine.

The other term you want to understand is Additional Interest. This is where the tenant should list the manager on the policy. This is basically making you a CC to all the policy changes. You would get a copy of the policy, notices if it lapses, changes, etc. Do not confuse this with Additional Insured. Do not have a tenant list you as additional insured. It can cause problems in event of a claim.

Muinda Gueston · Answer

@John Mocker thanks that is also good to know. Is it not typical of landlords to require renters insurance of the tenants? MD is the first state that Ive lived where it was requirement.

Muinda Gueston · Answer

@Christopher Phillips good to know that landlord insurance doesn't cover personal items of the tenants! should a landlord require that the tenant provide proof of renters insurance/ draft in the lease?

Owner and Renter insured simultaneously?

Most Popular Reply