Home insurance and other considerations
Creating a relationship with an insurance agent will make it easy for your tenants to get insurance quickly and provide you with proof of insurance.
As the rental market tightens, more and more landlords require, not just recommend tenant insurance. In fact, they make it a condition on lease agreements. Check with your attorney to see if you can change the tenant lease to require tenant insurance. You can also check with your insurance provider to see if requiring your tenants to carry their own insurance gives you any savings on your premium. In some cases, it will, and there are even some scenarios where your insurer may require your tenants to have insurance based on the occupancy of your home.
Tenant policies offered by Square One are designed to offer the most critical coverages at the most affordable rates for your tenants. A Square One agent can set up a policy over the phone and have the documents sent to the client within minutes. In fact, clients can even buy their policy online. It’s easy and convenient, and typically takes no more than 10 minutes. Agents can efficiently explain the benefits of tenants insurance to your renters, to help them understand exactly what types of scenarios they are protected against.
Request a confirmation of insurance from your tenants to confirm they have indeed purchased a policy. It is very common these days for landlords to request this document before handing over keys to tenants. The confirmation would list the limits of coverage, the date the policy was initialized, the policy number, and the name of the insurance provider. For privacy reasons, insurers will not be able to divulge details about your tenant’s insurance; however, they should be able to confirm at any time whether the policy is active.
Commonly asked questions
Do tenants need building insurance, too?
Tenants don’t need their insurance policy to cover the building they’re renting in, because they don’t have an insurable interest in it. That’s what the landlord’s insurance policy is for; the tenant’s policy only protects their own possessions, not the landlord’s.
Will tenant insurance cover leaving the home for repairs?
If your renter has to leave the property so that you can do larger repairs, the last thing you want is them looking at you to foot the bill for their expenses. Here’s another area where insurance can lend a hand.
Say unexpected water damage occurs and some flooring needs to be replaced. The damage is extensive enough where it’s unreasonable for your tenant to live there until the repairs are complete. In this case, it’s likely that tenant insurance will cover the costs of your renter finding a new place to stay until the process is finished—leaving both of you less stressed as a result.
Understanding the benefits of tenants insurance for you as a landlord, and for your renters, can help you clearly articulate to them why you are making it a requirement.
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About the expert: Daniel Mirkovic
A co-founder of Square One with 25 years of experience in the insurance industry, Daniel was previously vice president of the insurance and travel divisions at the British Columbia Automobile Association. Daniel has a bachelor of commerce and a Master of Business Administration (MBA) from the Sauder School of Business at the University of British Columbia. He holds a Canadian Accredited Insurance Broker (CAIB) designation and a general insurance license level 3 in BC, Alberta, Saskatchewan, Manitoba and Ontario.
