While they are thankfully scarce, fires and floods in your Chesapeake rental home can strike a devastating blow. Even when you've worked hard to get the right liability insurance coverage for your properties, you may run into the situation where an underinsured (or uninsured) resident has lost everything—and cannot replace it using insurance funds. Even if you're working with a Chesapeake property management company, acts of nature cannot be stopped—and losses do occur.
- It only takes one of these terrible occurrences to make most property owners look into the possibility of requiring renters insurance.
- Not only does it reduce the possibility of lawsuits against the property owner, but inexpensive rental insurance policies can also bring real security to renters who might otherwise find themselves totally without possessions in a major disaster.
Here are some of the ways you can learn more about renters insurance and the value it brings as part of your rental agreements in the Chesapeake area.
Foreword: While we are THE rental experts in Chesapeake, this blog is not legal counsel. If you need live support, get in touch with the Rent Estate™ Advisors at Renters Warehouse Hampton Roads!
Yes, You Can Require Renters Insurance in the Commonwealth
- Virginia's state law says that a property owner can require renters insurance if someone wants to rent the property.
- There is also the option to purchase renters insurance for the renter, provided the rate isn't above a certain level.
While there may be some renters who would balk at paying for the policy you've chosen, most will come around to the value of renters insurance if you let them participate in choosing their own policy.
- You'll want to make the process as easy as possible, especially if you have multiple properties.
- Work with your Chesapeake property management company to offer simple, easy options to your potential residents.
- They are less likely to balk at the expense and the additional paperwork if you make it simple and straightforward.
One way to frame the expense is to create a disclosure that explains the benefits of the insurance for you and for your renter. If you choose to offer a policy to your renters as part of the rent, highlight what it protects and how much protection (up to a dollar amount) they receive.
You Save Yourself Unforeseen Costs and Offer Protection
Insurance coverage is more important than your renters may consider.
- Even if they look around their belongings and think things aren't very valuable, the cost of replacing them could be very high.
- In the case of a natural disaster or other damage to their Chesapeake rental home, not having renters insurance could mean they lose everything.
- You can explain this potential situation to them, and if need be, you can acknowledge that it is a protection for you as well since your insurance does not shelter them.
- You want your renters to be able to replace their items in the event of an unforeseen maintenance issue, such as an exploding pipe resulting in a flood.
Renters who don't have renters insurance may opt to launch a lawsuit against you, whether you could be held liable or not, and that ends up costing you both money in legal fees. It's much cheaper to have renters insurance cover the losses when something happens to your Chesapeake rental home.
Circumstances When Everyone Benefits
The key when explaining any information like this to renters is showing how the low premiums, coupled with your rental rate, are still a good bargain for the location and the property itself. Your Chesapeake property management company knows the area and can show a potential renter how, even with renters insurance, they are getting a good deal.
At Renters Warehouse, we can also explain to residents how this protection really does help them, too: if there is an accident that destroys their property and the property owner isn't liable for it, they can still recoup their losses through their coverage if they have the right plan.
Another, wider-ranging benefit is that, the more property owners who require this coverage, the more normal it will become. A lot of tragedy and loss can be prevented with a little bit of renters insurance; it's worthwhile for everyone involved. With any luck, continuing to put renters insurance front-and-center for your renters will be part of making it easier to have it just become an accepted part of renting in the future.
Disclose How Little It Costs
The key situation with renters insurance is that it's in everyone's best interest for the building to be safe and well-maintained. As a result, renters insurance policies are very inexpensive compared to something like a vehicle since the risks are low.
- This does mean that you'll want to do some of the upfront work in discovering plans or have your Chesapeake property management company make some suggestions for you.
- Make sure your renters feel they are getting as good a deal as is available on their renters insurance. Alternatively, they can choose to shop around as long as they hit the minimum coverage amount that makes you comfortable.
Questions like whether a property owner should make renters insurance mandatory are often challenging, but that's where a helpful Chesapeake property management company like Renters Warehouse Hampton Roads can really help!
Of course, requiring renters insurance is just one successful element of building a strong rental portfolio in the Chesapeake rental market. To learn more, download your free copy of our guide to real estate investing!