Tenant Rental Insurance to cover damage

7 Replies

I am about to sign a lease for my first rental property this weekend! There is a question of how much rental insurance the tenant should get to cover any amount of damage to the property on top of loss of their own possessions. What is the typical amount or is there a percentage of coverage based on the value of the house? Exact wording in lease: "In addition to coverage for damage or loss to Tenant's personal property in such amount as Tenant may determine, the policy shall include coverage for bodily injury or property damage for which Tenant may be liable for in the amount of _______?

Thanks for any advice you can give!

Talk to your agent about the correct amounts, but you should also consider requiring the tenant to add you (or your LLC if that's the owner of the property) as an additional insured on their policy for bodily injury or property damage arising out of their use of the property. This means that if you get sued by someone is injured in their apartment, the tenants insurance company will have to defend you and pay before yours does.

Its possible their policy may already provide for this, but only if you require it in your contract, so it's important to require it.

At the apartment complex where I worked, we required a minimum of $100,000, but I know some places will require a minimum of $300,000! I'd base it off of the property (i.e. how much coverage you think it needs).

@Becca Barnes

The coverage you want to be concern about is General Liability.  That coverage extends coverage to the landlord for against claims of bodily injury against the landlord and tenant as well as property damage to your building that the Tenant may be liable.

The standard General Liability limit you want your tenants Renters insurance to carry is $100,000.

hope that helps,