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Property Management Blog

Insurance on your Charlotte, Rental Property – Property Management Advice

Today I want to discuss with you Landlord Insurance and Tenant Liability Insurance for your Charlotte, NC rental properties.

It’s important to understand that we are not insurance brokers and if you require more detailed information it’s recommended that you talk to your insurance company.

1-Landlord Insurance

You need Landlord insurance when you do not reside in the home that you rent out. It’s important for landlords to understand that regular homeowner insurance policies in most cases does not cover rental properties.

2-Tenant Liability Insurance or Renters Insurance

Typically, Neither Homeowners or Landlord Insurance will cover the tenant’s personal property or damage caused by the tenant.

If a tenant causes damage to the property they are typically held liable. In many cases the tenants do not have financial means to cover the damages or it is just difficult to collect the money from them. With tenant liability insurance it helps to minimize the liability.

So let’s say that a tenant damages your property…instead of making a claim against your Landlord or Homeowners insurance policy…instead you can make a claim on the Tenants Liability Insurance policy. This means that your insurance rates should not go up because you’re not making a claim against your policy.

As property managers we mandate that our tenants must carry Tenant Liability Insurance to protect our Landlords

Another thing that tenants should be made aware of is that their personal contents are not covered by the Landlords insurance. So it is in the tenant’s best interest to be have Renters insurance. In most cases, if a rental property becomes uninhabitable as a result of…let’s say fire for example…a good renter’s insurance policy will pay for the tenant’s room and board at a hotel while the problem is being resolved. This is good for the Landlord because then they can limit their liability of having to pay for those expense.

Who pays for Tenant Liability Insurance and how much does it costs?

-The Tenant usually pays for it and in some cases the Landlord will pay for it and charge the tenant. The average cost for Tenant Liability Insurance is $15/month on depending on the level of coverage.

Whose name should be on the Tenant Liability Insurance policy and how should it be managed?

-The answer is …the Tenant, Landlord and or the Property Manager

-A Property Manager can work with the tenant and insurance company to get it set up and it is highly recommended that your Property Manager is listed as an “Interested Party” on the policy so that we can monitor and have control over the policy to make sure that it is up to date and in place during the full lease term.

How do you get it Tenant Liability Insurance?

Tenant Liability Insurance can be acquired in a few different ways. The tenant can use their own insurance company or the homeowner can use theirs or the Property Manager can recommend the company that they use and set it all up and make the process easier for everyone