Part 2: The benefits of tenant insurance, liability and accident coverage
Tenant insurance covers a lot perils and can make for a much more peaceful and pleasant building.
However, while a landlord cannot force a renter to purchase insurance, they can educate and inform tenants about the benefits and relatively small cost such a policy can offer, especially in the often-forgotten area of liability coverage.
Renter and tenant liability coverage
Liability coverage provides protection if someone is injured while in the tenant’s suite. A liability policy may pay any court judgments as well as legal expenses - up to the policy limit, of course.
Accidents do happen
Tenants must be made to understand that accidents do happen. While incidents, injuries and damage may be rare, securing protection from legal and financial ramifications can be simple and inexpensive.
Every property manager and landlord has stories of accidental falls, injuries and damage within tenant suites. While a tenant may not have intentionally injured the person or their possessions in their home, or meant to damage a neighbour’s property, there is always a possibility they could still be held liable.
As well, even if the tenant’s dog has never bitten a person, there is a chance he may. And the odds increase in higher-density, higher-traffic flow environments like apartment buildings and condominiums where interaction with neighbours and fellow residents are much more frequent than in a single detached home. Properly structured, third party liability insurance can provide protection from medical and legal costs resulting from a dog bite.
It is important to note that liability coverage is included in most standard renter’s insurance policies. While policies vary, most provide at least $100,000 of liability coverage, and between $1,000 and $5,000 for medical-payments coverage. If tenants need more, they can request -and pay more for - higher coverage limits.
Professional property managers should encourage tenants to carry third party liability insurance. Many tenants will realize the low-cost, high-benefit coverage will protect them from the costs associated with accidents which could cause damage or injury to another’s person or property. As well, insurance will lower the risk of distressed, hysterical tenants faced with spiraling costs to rectify a problem they could have otherwise been protected from.