We help real estate investors apply the best strategies to maximize their income in the Washington, D.C. rental market. One question we often hear from property owners is, 'Should I require my residents to carry renters insurance?'
In our opinion, as experts in full-service property management and community association management, the answer is, 'Absolutely.' In D.C., rental property owners can require all residents to maintain an active renters insurance policy. Before you become concerned about legal issues or losing quality renters who prefer not to have insurance, we'll walk you through why property owners should prioritize this critical form of renter protection.
With our history and experience as property managers for D.C. rowhomes for rent, we've learned that renters with renters insurance are better for your long-term investment success. Here's what you need to know.
Please note: This post is not a substitute for proper legal counsel and contains current information at the time of its publishing. When in doubt, it's best to reach out to the professionals at EJF Real Estate Services or obtain guidance from a skilled attorney.
It Doesn't Cost You a Cent
One of the best perks of requiring renters insurance from every resident is that it doesn't cost investors anything. Some rental property owners and Washington D.C. property managers make it easy for renters to sign up for a policy by offering it as part of a resident benefits package. However, investors don't need to pay for policies to make sure their renters have this coverage.
- If a potential renter doesn't already have coverage, helping them find a policy that fits their needs helps protect them from property loss.
- It also helps protect you from potential headaches that come from a renter without insurance who tries to seek compensation for property damage from you.
Include It as Part of the Qualification Criteria
The best way to make renters insurance mandatory is to include it with your qualification requirements during the renter screening process. By making it mandatory for every renter, investors avoid discriminatory practices while still complying with fair housing laws.
- Requiring renters insurance also helps investors determine qualified Washington D.C. applicants during the screening process.
- If a potential renter doesn't see the need for renters insurance and won't pay for coverage (either through your leasing process or with an outside provider), they don't meet the criteria for your property.
- Renters who value their personal property and maintain an active insurance policy demonstrate that they'll probably care for your rental home and become a good resident.
It's Inexpensive for Renters
The cost of a quality renters insurance policy is often as little as a few dollars per month. It's well worth the expense for renters to secure this coverage and have a personal safety net if something goes wrong while living in your Washington D.C. rental property. Whether they experience theft of personal property or your rental suffers from a fire or extensive water damage that ruins your renter's possessions, the low cost of renters insurance can help them recover.
If you have long-time renters or deal with a hoarding situation, claiming property loss could be expensive. Investors don't need to deal with a renter expecting them to cover their personal property costs after a devastating event. Your insurance policies as a D.C. rental property owner don't extend coverage benefits to renters living in your rentals—even though residents might try to convince you that it does.
While you work with your insurance providers to repair your D.C. rowhomes for rent and make them ready for your renters again, residents should turn to their renters insurance provider to file a claim and seek property loss reimbursement.
Review a Policy During Lease Renewal
Mandatory renters insurance shouldn't apply only to new renters during your screening process. For residents to renew and continue enjoying your rowhomes for rent in Washington D.C., they should maintain an active renters insurance policy throughout every lease term.
- Before finalizing a lease renewal, request proof of a current policy that will continue through the upcoming lease term.
- If an existing resident lets their policy lapse or refuses to get new coverage, remind them of the requirement.
- When the deadline passes to renew the lease with up-to-date coverage, work with a D.C. property manager and your legal counsel for the next steps.
Renters Insurance Is Smart for Renters and Investors
- A good renters insurance policy provides peace of mind for your renters.
- If anything goes wrong, they've paid a minimal sum of money to recover out-of-pocket expenses to replace clothing, furniture, and other personal belongings.
- While property owners don't directly benefit from a renter's insurance policy, they also receive peace of mind when residents understand the importance of this critical coverage.
A Property Manager Enforces Renters Insurance for Your Peace of Mind
It's never too late to start requiring renters insurance for the residents in your D.C. rowhomes for rent. When it's time to find a new resident or renew a lease, EJF Real Estate Services can help you update your lease and navigate the renters insurance policies with your renters. We require it for every renter and every rental home.
Enforcing renters insurance is one of the best ways we work hard to protect your investments and income. However, it's not the only way we help you grow your portfolio in the D.C. area. You can learn more about the benefits of real estate investing with the aid of professional property management services when you download your free copy of our guide!