Content Insurance for your Tenants – a good old tool for your risk mitigation toolkit
Date: 30.06.2017
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Real Estate investors who become landlords have a lot on their mind – Lease Agreements, Maintenance services, utility payments, rent payments….the list goes on and on.

One item that may pop up, and in many cases left undealt with, is contents insurance (sometimes called tenant insurance, or renter’s insurance).

Your tenants need this

Irrespective of the type of property you own (condo unit, townhouse, detached) your tenants have neighbors, and like your property, are at the mercy of Mother Nature. While the property is (or damn well should be) insured through your property insurance, the coverage often does not extend to the tenants’ contents – so bad neighbors or bad weather can cause the damage or destruction of their belongings.

Eventualities such as fires, floods, sewer backups, or ugly protests are a reality that many tenants think is the landlord’s problem. It is not – and when the dust settles – many tenants find themselves in financial and material ruin.

As a responsible landlord, you need to have this conversation with your tenants and expect to see valid contents insurance in place.

You need this

If troubles befall your property, and losses are incurred by yourself and your tenants – you will likely be facing the following tasks:

  • Dealing with your insurance company
  • Relocating the tenants
  • Arranging for various repairs to your property
  • Meeting with adjusters, assessors, inspectors, law enforcement and emergency officials, and maybe even the media
  • Having to be on the property to deal with the city, the neighbors etc.
  • Dealing with utility companies

This is a lot to deal with, and it will take some time until (if at all) your property is back to good order. What you don’t want to deal with – is angry tenants who are blaming you for failing to do this/that and threatening a lawsuit because their possessions are gone. You have no time for that, and why on earth would you want this on your plate?

As a condition of tenancy, you have the ability to request proof of contents insurance prior to the start of the lease AND prior to each lease renewal AND at the expiry of a contents insurance policy term. The last AND needs to be tracked by you – do not expect the tenants to remember this – write down somewhere when their policy expires and request a copy of the renewal.

Insurance-2

Alex Goldstein

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