Landlords Require Renters Insurance to protect their liability. Many landlords also require to be listed on the renters insurance policy as additional interest. Therefore they will receive notice from the carrier directly if the policy cancels.
Tenant’s often assume that a landlord’s insurance policy covers their personal property. However, landlords are not usually responsible for the tenants property or temporary housing. But a renter’s insurance policy would provide coverage for the tenant’s personal property in addition to temporary housing.
Example Liability Exposure:
For example, a tenant hosted a birthday party and a guest was injured. The tenant doesn’t have renters insurance to cover their liability and the guest has no health insurance. As a result, a lawsuit is filed against the landlord as the property owner. The landlord’s insurance may pay the suit under their liability. This results in a liability claim on the loss history which can affect the premiums. If the tenant had renter’s insurance, the landlord would likely not be affected.
Sample Lease Clause:
Below is a sample lease clause. Be sure to consult an attorney to review your lease. I am not a lawyer and this is not legal advice.
REQUIRED RENTERS INSURANCE: Landlord does not maintain insurance to cover the personal property of Tenant(s) or personal injury to Tenant(s), their guests or occupants. Tenant(s) is required to obtain rental insurance in the amount of $300,000 liability and list the landlord as an additional interest on the policy.
Landlords should be sure to review the VA Residential Landlord and Tenant Act handbook