Liability Insurance for Tenants: Is it Mandatory?

Liability Insurance

Owing to the ever-rising prices of real estate, buying a house has become an outdated concept. On the contrary, renting has emerged to be the new trend. While renting may sound an easy way out, it is definitely tricky to a certain extent. Tenants stay inside the house once lovingly constructed by their landlords and are always under an extra layer of scrutiny. Probably an insurance plan ensuring liability to accidental damages doesn’t hurt, does it? It protects tenants and their landlords by mitigating a lot of their problems.

Liability Insurance
Liability Insurance for Tenants: Is it Mandatory?

1)WHAT IS A LIABILITY INSURANCE FOR TENANTS:

Some landlords and letting agents may need their tenants to get an insurance plan fixed while they prepare to move into their property. The insurance plans provide coverage for cases of an accidental mishap, like breaking off of fixtures, fittings and in some cases furniture as well.

These plans have a wide scope. They range from protecting the tenants from the damage of small, trivial objects to large pieces of ornate furniture.

But with every insurance comes its disadvantages. Not all renter’s insurance provides coverage against fire, flood destruction of property or even theft. Neither will they cover damages produced by wear and tear of an object.

2) DIFFERENT TYPES:

There are different kinds of renters insurance available in the market customized according to preferences, pricing as apparent through a customer consensus.

The two different types are: Standalone type and Home Contents insurance type.

The former is a smaller package and is better suited for people who don’t have a lot of property themselves and would want to get their security deposit back when they move out.

But for people with a greater deal of possession, Home Contents insurance plan can be handy.

This particular plan has broader coverage compared to what the usual Tenants Liability provides. The Tenants Liability insurance is clubbed along with it. This can be ideal as it also safeguards the property of tenants themselves.

3)PROTECTION OF THE TENANTS:

One of the key necessities of letting one’s house at a rent and allowing tenants to stay is trust. Trust increases manifolds with this insurance in play. The property of the tenants may not be covered completely under the rental protection plan, but the tenant’s insurance provides full-term protection to their property and also the property of the landlord. This provides coverage beyond the four walls of the house.

The next reason why this should be taken is that accidents can happen to anyone and everyone. The assurance that the insurance coverage will help the tenants get through the initial days of emergency accommodations in the event of any massacre provides a lot of peace and allows the landlord to focus on repairing their houses.

4) LANDLORDS PROTECTION:

It saves a lot of time and money for the landlord. The renter’s insurance plan does provide a lot of perks with respect to building protection, but doesn’t it sound more feasible to get the claim registered against the tenants liability insurance?It surely does. This particular event will allow the person to get coverage without any deduction from their own premiums. A little extra money is always good, isn’t it? So if there is an accidental fire or water damage, the TLI has your back.

5) HOW MUCH DOES THIS INSURANCE COVER:

There are a lot of insurance plans out there. The general liability plans for businesses come with their own set of perks and disadvantages. This insurance plan covers a lot of damages to different intensities. Starting from breakage of small articles to fire, storm, flood to theft, a collision can be reported. In case there are a few valuable things like bicycles, smartphones, laptops, jewelry, etc. should all be accounted for in front of the insurer. This provides coverage against the theft of these substances. A lot of people forget to do so and miss out on their golden opportunity of safeguarding their belongings.

6) IS IT… MANDATORY?:

No, it isn’t mandatory per se however it is beneficial. As already discussed, this provides us with a lot of protection that could not be obtained from the rental insurance plans and would ultimately lead to the seizure of the security deposit paid to the landlord. Unnecessary tension of always being careful around things of the landlord also wanes away a bit as this insurance has the capacity to make the situation better if it ever entangles.

As a landlord, it is crucial. The rental market keeps on getting busier, so it is necessary for the landlords to ask for tenants insurance and make it a part of the lease agreement. This helps in screening the tenants as well. The ones who aren’t meeting up the criteria for insurance may not be the best people to rent our house to.

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