Did you know that a landlord in Houston can be liable when a tenant or even a guest is injured on a rental property? This is true even if the landlord is served by a property management company in Montgomery. Tenants can be responsible too, and in that light, let’s consider landlord and renters liability insurance, when they apply and how much you need in order to protect yourself.
What Is Landlord Liability Insurance?
Landlord liability insurance, which goes by a number of different names, including rental property insurance, protects a property owner against financial losses incurred from a lawsuit that a tenant has filed against them. If a guest at your home falls down and breaks his ankle, then his medical expenses may be covered by your home insurance policy. Even though you may have home insurance on a rental property, the same isn’t true if a tenant or a guest of a tenant brakes his ankle. That’s because this is a business and the home insurance doesn’t apply, which is where landlord insurance comes in. This is coverage you need even if you have property managers in Montgomery overseeing the unit.
What Is Renters Liability Insurance?
When we think of rental insurance, we often think of coverage in the event that property is damaged due to a fire, unrecoverable due to a theft and so forth. However, rental insurance is often a lot like home insurance and includes a renters liability insurance component. This protection can cover legal expenses, damages, and other costs should you be found responsible. If your child accidentally throws a baseball through a neighbor’s window, that’s on you, and this coverage could kick in. If the standard liability coverage provided with a rental policy isn’t enough, tenants can expand that coverage with a personal umbrella policy, which would kick in when the other liability coverage had been exhausted.
What Does Liability Insurance Cover?
Liability insurance for both tenants and landlords is a form of personal liability coverage. It’s worth noting that what a policy covers will depend on the particular policy because policies vary from one provider to the next and you do have options. Nevertheless, we can discuss coverage in a general sense because there are aspects that are consistent across most policies. We’ve already mentioned legal expenses, and that protection applies when you’re sued and even if you’re found not responsible. It can also cover:
- Medical expenses
- Rehabilitation expenses
- Pain and suffering
- Death benefits
- Loss of income or support
When Is a Landlord Responsible?
A landlord isn’t simply responsible whenever an accident occurs on a rental property. The person suing must be able to demonstrate that the landlord or an agent, such as a property management company in Montgomery, was somehow at fault either through negligence or wrongful conduct. It’s worth noting that in this context, negligence need not be specifically proven. If a landlord knew about or should’ve been aware of a hole in the sidewalk, for instance, and either took no action or didn’t provide adequate warning while steps were being taken to correct the situation, he’d be liable. Dogs also expose landlords to liability, which is why many charge a pet fee and don’t permit large and aggressive breeds.
When Is the Tenant or Guest Responsible?
Under the law, adults are responsible for themselves. If you fall down and break your ankle and no one was negligent, then that’s your responsibility. Your insurance must cover that loss or you may have to pay for it out of pocket. A tenant can also be negligent or otherwise responsible. Earlier, we mentioned a child that throws a ball through a window. That applies. Likewise, if you purchase stones to decorate and placed them on a walkway and someone trips, then as the tenant, you may be responsible.
How Much Coverage Should a Landlord Have?
How Much Coverage Should a Tenant Have?
The basic renter coverage costs about $150 to $250 a year and provides $30,000 in property coverage and $100,000 in liability coverage. The average cost of lawsuits against tenants, including legal defense, ranges from about $60,000 to $80,000, so $100,000 in liability coverage seems right. Whether the $30,000 in property coverage is enough depends on what you own. If you have many valuables, you may want to go higher, and be sure to itemize those valuables in advance.