Most landlords have fire and liability insurance covering their property. Usually they get what’s called a “special form” or “broad form” policy. These policies have additional provisions such as medical coverage and lost rental income coverage among other things. Many property owners do not carry earthquake insurance due to its high premium and high deductibles.
The majority of properties have a mortgage on them and the lender requires a certain minimum insurance coverage to protect their interest in the property. Tenants should ask what coverage a landlord has before entering into a rental or lease agreement. If a tenant wants their personal property covered they should investigate getting their own renters insurance policy.
It is helpful to understand renters insurance. There are many different types of policies from a variety of companies. You should never assume that the landlords insurance policy covers you; most of the time it does not. Some policies not only protect your possessions from theft, fire or damage in your residence, but some policies cover your possessions while you are at work or when you are traveling.
Renters insurance average cost is about $12.00 per month for $30,000.00 property coverage and $100,000.00 of liability coverage. Most renters’ policies not only cover the tenant’s personal possessions, but also have liability coverage. This liability coverage covers the tenant and the landlord. If one of your visitors slips and falls in your home, your liability coverage will help cover the medical bills and legal defense bills. If you have ever asked yourself, “Do I need renters insurance?” the answer is probably yes.
Usually landlords do not have coverage for a tenant’s possessions. Attitudes toward insurance vary; some people wouldn’t be without it while others consider it an unnecessary expense. Like property owners insurance, renters insurance is a package of several types of insurance designed to cover tenants for more than one risk.
Most people’s belongings are worth more much more than they realize. Each insurance company’s package will have slightly different types of coverage offered, and the dollar amounts specified for coverage and the deductible will vary. It is always worthwhile to shop around and compare policies and prices.
Many landlords have begun inserting a clause into their leases or rental agreements requiring that the tenant purchase renters insurance. This is legal under California law. Others are having the tenant sign a statement that says it is recommended they get renters insurance and, if they decide not to, the landlord is held harmless in case of loss and or injury.
Everyone should consider the insurance issue carefully. You may think it’s a waste of money until you need it, and by then it’s too late
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