Renters Insurance?

If your current Property Management Company is not requiring your tenants to carry renters insurance, they should be!

The cost to repair a 1,000 square foot apartment in the 93308 zip code from a typical water leak averages over $12,000. (estimate from www.homewhyse.com)  Ask yourself how many tenants do you have that could come up with that much cash to reimburse your expenses?  In my experience there will not be many.

Requiring renters insurance is a must to protect your investment.  For a minimal monthly fee, your tenants will have the liability coverage they need to assure you are not stuck footing the bill and then subsequently tracking down a previous tenant for a debt that they will never be able to repay.

In addition to covering your investment, renters insurance can be a lifesaver for a renter who experiences a burglary.  In November of 2012 (while I was in the hospital after the birth of my daughter) my home was robbed.  In the two hours the house was empty, the thieves made away with over $7,500 worth of my personal belongings.  We were hit again in December, (while we were away for Christmas) for a total loss of over $5,000 this time.  Thankfully we have a renters insurance policy that covered replacements for all of our things.

Mission Real Estate & Property Management requires that all of our tenants carry a minimum of $100,000 in liability insurance.  Our technology partner, Appfolio, makes this process easy for us with integrated insurance solutions.  We are able to offer our tenants liability insurance with rates as low as $9.50 a month. The average renter's policy costs just $185 a year, according to the National Association of Insurance Commissioners.  Very affordable for nearly every budget.

The idea that requiring prospective tenants to carry renters insurance will drive away business is no longer the case.  It is becoming an industry standard.  According to a Rent.com survey, 40% of renters have carried renters insurance.  Nearly half of the prospects we tour will already be familiar with renters insurance. A survey last year for The National Multi-Housing Council, a national association representing the interests of larger apartment companies, indicated that 66 percent of the 45 participating companies required residents to have renters insurance in 2010. That was up from 44 percent in 2009 and was a big leap from 24 percent in 2008. The companies represented a total of 750,000 apartments.

Don't set yourself up for a serious financial liability.  Ensure that your tenants carry renters insurance and save your self the hassle, expense and headache.

Athena Magruder
Vice President Operations
Mission Real Estate & Property Management, Inc.
3600 Pegasus Dr #15, Bakersfield, CA 93308
www.missionre.com