Normally, tenants are required to have a tenants’ insurance. However, this requirement may or may not be outlined in the tenancy agreement that you sign with your client. It’s always wise to have it stipulated in the tenancy agreement. However, you must take into account the possibility that your tenant may fail to pay the annual or monthly premiums of their renters’ insurance. Yes, it is always wise to make them a few premiums in advance. But again, they may still fail to pay the premiums that follow and you may have to bear the financial burden for some losses that happen to the property during the period of tenancy. Now, you may think that by contacting their insurance agent regularly, you can easily figure out if there is any premium lapse. It is also highly recommended to list yourself as Additional Interest of their coverage. This way, you will stay informed about whether or not your tenant’s insurance is in good shape. Nevertheless, you should still try to minimize your exposure by making the insurance processes less complicated.
Understanding what losses are covered by your Landlords’ Insurance policy and what losses are covered by the renters’ insurance policy of your tenant can bewilder you enough to not pay heed to small details. Typically, a standard landlords’ insurance policy provides coverage to the building with an option of adding additional coverage for any contents that belong to the landlord. Renters’ Insurance, on the other hand, provides coverage for the improvements and alterations that the tenant makes to the property during the period of their tenancy. Liability coverage is normally a part of both renters’ insurance and landlords’ insurance. The specifics, however, vary from policy to policy. Though a Renters’ Insurance is comparatively less expensive than a homeowners’ insurance, there are other cost-effective alternatives that benefit both the tenant and the landlord.
Tenants’ Protector Plan is one of those cost-effective alternatives. It is a low-priced coverage that benefits both the tenant and the landlord. It costs considerably less than a Renters’ Insurance. The best thing about Tenant’s Protector Plan is that it can be used for some or all of your occupied properties. Tenants’ Protector Plan has fixed coverage limits. A liability limit of $50,000 is stipulated for tenant-caused losses and this constitutes a great number of property losses suffered by the commercial sector.
You should never be the one who has to pay for your tenant’s negligence. Oftentimes, the damages caused by the negligence of tenants are catastrophic. These damages can range from a kitchen fire that rapidly spreads throughout the house to a bedroom sinking in water because your tenant forgot to turn the faucets off. In case of any of such damages, your insurance company will compensate for the losses suffered. However, this will also increase the amount of your premiums over time. The insurance company will cover all the costs while also trying to recover the funds you paid them irrespective of whose fault it was.
Tenant Protector Plan can save you a lot of money as it transfers the responsibility to the at-fault party. A tenant protector plan will not only transfer the responsibility but also pay $50,000 before any payment is taken from the negligent party. This will save you from making any out-of-pocket payments for the losses caused by your tenant. This also helps stabilize the rate of your property. But, like mentioned above, Tenants’ Protector Plan extends its support to both the tenant and the landlord. You must be wondering how? Well, the belongings of the tenant are also covered by a Tenant Protector Plan. However, this coverage works up to a certain limit. The coverage sublimit of $10,000 is set for the belongings of your tenant. This is particularly beneficial when your property suffers a total loss. This coverage sublimit will help your tenant compensate for some of their losses if not all of them. It can also help your tenant pay the deductibles of their tenants’ insurance. In many cases, the negligence of one tenant makes other tenants pay. Therefore, a coverage sublimit of $2,500 is also included in Tenants Protector Plan. This coverage will compensate for the losses of the affected tenants who were not at fault.
Now coming to the most fascinating part of the Tenant Protector Plan that it also includes coverage for Skip Rent. This way, you do not have to rush here and there to find a new tenant if your tenant terminates their tendency midway. This coverage compensates for the rental income that you have earned if the tenant had not left. However, it must be noted that it will not cover for all of your lost rental income. As mentioned before, the submit for this coverage is $1,000.
Tenant Protectors’ Plan is a cost-effective alternative to other insurance policies like Renters’ Insurance. It’s the best way to make sure both you and your tenants are protected from unexpected losses.