Austin, Texas has a lot of renters, which we means we sell a lot of renters insurance. These renters often wonder why landlords require renters insurance. Although landlords usually have insurance of their own, it probably only covers the building, not a tenant’s personal property or liability.
Landlords do not want to be responsible for their tenants’ negligence.
For example, if a tenant leaves water running in a bathtub and it overflows and damages the building and property of the tenant below, the landlord does not want to have to pay for the damages. Landlords want their tenant or their tenant’s insurance company to pay for the loss. Without renters insurance, tenants could be sued and held personally responsible for damages they cause. For that reason, a renters policy not only protects the landlord, but protects the renter, as well. Most landlords require a minimum of $100,000 in liability coverage.
Personal property and liability protection:
Renters insurance also protects a tenant’s personal property that is stolen or lost in a fire, explosion, or by lightning, wind, hail, smoke, or falling object. There is also limited coverage for property that is stolen or damaged off premises, such as from a car or hotel room. However, renters insurance does not protect property from flooding, or rising water, but it is possible to purchase a separate flood policy. In addition, renters insurance provides medical coverage, up to policy limits, if a guest is hurt in the home or apartment.
The good news about renters insurance is that it is relatively inexpensive:
- The average cost per month for renters insurance is $16.
- The average renter owns $30,000 worth of personal property.