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Renters insurance as part of your rental agreement

By Compuquotes Team on March 27th, 2008

Renters Insurance

Though renter's insurance generally isn't considered to be a standard part of a rental agreement, there are an increasing number of rentals that at least take renter's insurance into consideration. With some it may be as a suggestion that's mentioned in the rental agreement, while other leases may actually try to require that the renter take out renter's insurance to reduce the landlord's liability. This can be useful for both the tenant and the landlord, but it has been debated as to whether it's fair to include it as a part of the rental agreement itself. If you've wondered whether it's right to have renter's insurance be a part of the lease, here is some information that might be of some assistance.

Is renter's insurance required?

In most cases, renter's insurance isn't going to be required when you move into an apartment or rent a house. It's often recommended since your landlord's property insurance isn't going to cover any of your losses, but it isn't usually a hard and fast requirement. There is somewhat of a growing trend to include a renter's insurance clause in rental agreements, though, allowing a limited timeframe during which the tenant must purchase renter's insurance as a condition of continuing to occupy the apartment or rental property.

Benefits of including renter's insurance

There are actually a number of benefits to including renter's insurance as a part of the rental agreement, most of which provide added security and protection for the renter as opposed to the landlord. Renter's insurance can cover the cost of replacing stolen or damaged furniture, electronics, and other possessions in case of break-ins or many natural disasters. In most situations you'll find that any insurance that your landlord has won't cover any of your possessions, so renter's insurance is the only way that you can have peace of mind in knowing that your personal belongings are protected.

Legality of including renter's insurance

Even though it isn't necessarily standard practice, there generally isn't anything illegal about including a clause in a legal agreement requiring a tenant to take out renter's insurance. As renter's insurance is designed to protect the tenant instead of the landlord, it can be difficult to make a case against it being included in a lease agreement other than the cost of maintaining insurance (and renter's insurance is usually rather inexpensive, especially in comparison to other forms of insurance.) As rental agreements must comply with the laws of the state that the property resides in, though, you should consult an attorney or other legal expert to make sure that the inclusion of renter's insurance as a requirement is legal in your state.

Choosing a renter's insurance policy

If you want to rent an apartment or house where renter's insurance is required as a condition of the rental agreement, you'll need to try and find a renter's insurance policy that you like. Shop around at different insurance companies in your area as well as online, comparing prices and the amount of coverage that's offered. Take note that many policies don't include flood damage or some other types of natural disasters, so make sure that you have sufficient coverage to meet your needs.

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