What could go wrong with your Sarasota rental properties? When you deal with rental homes, renters, and Gulf Coast weather, just about anything 'could' go wrong. Even with the best rental property maintenance practices, rental homes can suffer from resident accidents or weather-related flooding and acts of nature.
- Smart investors know the importance of the right insurance protection for their real estate portfolio.
- From property owner insurance to liability and rent loss coverage, investors must protect their wealth with the right policies.
- Most insurance policies designed for rental property investors don't cover your renter's personal property.
- If your renters suffer property loss from a storm that damages your rental, they could try to hold you responsible for compensation.
How can investors protect themselves when a renter experiences personal property damage or loss during a lease term? As a Sarasota property management company, we recommend requiring renters insurance for all residents. Here's why!
Foreword: The following article is not a substitute for legal counsel. The information contained herein was current as of the time of writing. If you need immediate help with a pressing issue concerning your rentals, turn to a competent attorney or our Gulf Coast experts for real-time assistance!
Can Property Owners Require It?
In Florida, the simple answer is 'yes.' Property investors can require all renters to have an active renters insurance policy during their lease terms when you include this within your lease agreement.
While you are not responsible for accidental damage to your renter's property, there's always the risk that a renter might try to get you to pay for damages if something happens. Fighting these claims can be expensive and time-consuming—especially if they have no merit for the claim.
However, if your Sarasota residents have a renters insurance policy, you don't have to worry about getting involved when something damages your renter's property. You can focus on the damage and recovery of your rental home while your renter deals with compensation for their personal property through their coverage.
Is It a Good Idea?
Expert Sarasota property management companies recommend that property owners require every resident to carry active renters insurance. Renters insurance is inexpensive and covers just about anything that can go wrong during a lease term, including:
- Florida hurricanes*, windstorms, hail, or sleet
- Lightning, fire, smoke, or explosions
- Damage caused by vehicles or aircraft
- Vandalism or theft
- Falling objects
- Power surges.
*Note: Hurricane damage and flooding may require additional coverage.
These things can happen outside of your control or despite your renter's best preparations. With an active renters insurance policy, your renter doesn't have to worry about expensive losses due to any of these conditions. Their insurance company handles the claim and replacement costs for damages caused by anything covered in your resident's policy.
Requiring renters insurance is a win-win situation. If a renter has never had a policy before, it's an excellent way to help them protect their personal property when they rent a home from you. It only takes one catastrophic loss for a renter to regret not paying a few dollars every month for renters insurance.
When your residents have this protection, you win, too. There's no cost to a Sarasota property owner for a renter to have an insurance policy. Requiring renters insurance helps investors:
- Screen potential renters: If an applicant refuses to get an insurance policy, you probably don't want them living in your rental.
- Avoid lawsuits: With renters insurance, residents do not need to sue a property owner if an unexpected event damages their personal property.
- Save money on investor insurance: Your insurance premiums might go down when you require coverage for your renters.
- Allow pets: Offering a pet-friendly property broadens your pool of potential quality renters. A pet-owners renters insurance coverage helps protect your property from pet-related damage.
While your resident's insurance policy helps protect you from unsubstantiated damage claims, lawsuits, and other potential problems, it's not a foolproof failsafe for you.
Requiring your residents to have an insurance policy doesn't take you off the hook to provide a safe and well-maintained rental home for renters. If your Sarasota rental home is a hazard, renters can sue you for personal injury or property damage that's a result of your negligence.
- Investors must show their residents the appropriate level of care for their rentals.
- The example you set for rental property maintenance, quick responses to emergency repairs, and the renter's property care responsibilities help keep everyone safe and minimize the potential for damage and insurance claims.
- Make sure your rental property listing includes the criteria required to live in your rental, including the requirement of renters insurance.
- When you walk through the lease agreement with your resident, the property care and maintenance responsibilities should be clear—both yours and your renter's.
Mandatory Renters Insurance Protects Your Investments
It's a reasonable requirement for residents to maintain an active renters insurance policy while living in your property. If you don't currently have this requirement, make it a policy when it's time to find a new renter or renew a lease.
Protection doesn't stop with insurance coverage! Choose the best professional Sarasota property management company to maintain your rentals and prevent potential damage or liabilities that can derail your income. Let Gulf Coast Property Management enforce your renters insurance requirement and maintain your properties: it's one of the ways we help investors gitem their portfolio!
You can also learn more about the benefits of working with property management to help gitem your portfolio when you download your free copy of our guide to real estate investing!