It all depends on your state. Some states allow landlords to require renters insurance, some allow up to a specified amount, and some don’t. Depending on where you live can affect whether your landlord may require renters insurance or not. Even if your landlord does not require renters insurance, it may be a smart decision to search for a policy.
Renting a home can be an affordable way to live and many Americans are turning to rentals rather than purchasing a property outright. With renting – be it a home or an apartment – upfront costs can pile on. Before moving in you must pay last month’s rent and the upcoming month’s rent as well as putting down a security deposit. These costs build and build quickly and most renters don’t want to see that added cost of renters insurance on their lease.
Some landlords will require it before the tenant is allowed to move in. Even if they aren’t allowed, purchasing a policy might be in your best interest. A renters policy helps protect not only the landlord but you and your belongings. If a disaster strikes, the landlord is responsible for the building. No one, besides you, is responsible for your belongings. That’s where renters insurance comes in handy.
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What does renters insurance include?
Let’s start with what exactly you will be covering with a renters insurance policy. As mentioned above, your landlord will have an insurance policy that protects your home’s basic structure. Along with this, they will be responsible for any property damage. But when it comes to you and your belongings, your renters insurance kicks in. There are two types of protection with renters insurance.
- Personal property insurance – Your belongings are typically more susceptible to destruction than your home. Risks like theft, water damage, and negligence will all be covered under your basic renters insurance policy. If your items are damaged in a fire or stolen during a robbery, your renters insurance will help replace or repair them.
- Liability coverage – Any issues that arise from tenant negligence to the property will be covered with the renters insurance. If a kitchen fire occurs and damages the walls, the renter will be protected with their insurance. Any court costs or legal issues that arise from a liability on the property will be covered by your renters insurance.
Renters insurance protects the renter, not the property. The landlord insurance will cover any damages that occur to the home has as this is their issue to deal with. Renters insurance is much more about keeping the renter and their belongings protected in the face of disaster.
Can your landlord require renters insurance?
Landlords can require renters insurance in certain states. Not all states allow landlords to require it and some only allow renters insurance up to a specified amount. This is typically done to protect the renter from helping finance the landlord’s policy. In states like Oklahoma, no renters insurance is required as the tenant’s rent is sufficient to help the landlord pay for insurance premiums. Along with this, landlords are not allowed to have their renters buy insurance to get them discounts on their premiums.
Other states allow landlords to require renters insurance but only to a certain amount. With this protection, landlords can only require you to have $100,000 in liability protection rather than $200,000. The landlord will also need comparable protection in their policy with what they require the renter to have in theirs. In states like these, your personal financial situation is considered as well. If your household barely makes enough to rent the home, you will not be required to add renters insurance.
Some states do allow landlords to require renters insurance. It varies state by state so speak with an insurance representative to know what the laws in your state are. If you do not want to pay renters insurance, your state might not allow your landlord to force you.
Renters insurance helps protect the landlord financially. In basic terms, the reason why a landlord wants you to have renters insurance is for money. By requiring a tenant to have renters insurance, a landlord might be able to use their deductible to pay for tenant negligence. If a renter burns the kitchen, and they have renters insurance, their deductible will pay for damages. If they don’t have renters insurance, the landlord’s deductible will pay for damages. In short, requiring renters insurance protects the landlord as much as it protects you.