Renter Insurance and Lease Requirement to "Insure the Premises"

**monicapeeper** · 06-03-2012, 12:17 AM

My question involves insurance law for the state of: New York

We plan to sign a lease tomorrow but tonight when reading through the rider we noticed a clause. It requires us to "insure the premises with a minimum of $500,000 in coverage." It also reads that coverage for fire or water damage must be included.

We have renters insurance for our current place but it's my understanding that this only covers our property and personal liability if someone visiting slipped and fell etc. Based on the limited information I can find it doesn't seem that I can insure someone else's property. However, I've read that I can add a flood rider to my renters insurance. Also, if the property were damaged and the owner of the house sued me doesn't my renters insurance cover me for that?

We are insured through USAA if that helps at all. I'm not entirely sure what she's asking us to insure but if it's her property I don't know if that kind of insurance is even possible?

Thanks in advance for any information that might hep clear this up.

**SChinFChin** · 06-04-2012, 06:35 AM

I'm a LL, and I require renter's insurance of my tenants. Having said that, I have not stipulated flood or a liability amounts, though I doubt that it is illegal to stipulate it.

It is true that you cannot insure for someone else's property, but what you indicated on here is NOT you're paying for the LL's insurance. but insuring for your own negligience, for up to $500,000. While it is more common for these requirements to be included in commercial rentals, and unusual for residential, because of the increasing litigiousness of our society, I don't blame the LL for being a bit stringent.

As an aside, I was a commercial tenant, we had an accident, resulting in a fire, and serious injuries to some workers and property. Because my employee was limited to what he can sue me for under workman's comp law, he turned around and sued the LL for $1,000,000. So the LL turned around and sued me for our negligience, and thankfully I had enough coverage, for $1,000,000, which was also stipulated in the lease.

As to flood, that has me scratching my head, because as LL, I had a few occasions where I had damage to my rentals that would've been covered under flood, and but it all had to do with the landscaping and constructions issues with the property, my responsibility, which is why I have never required that of my tenants. I require renters insurance for the simple reason that before I required it, tenants assume that because I carry insurance, anything that happens, the tenant got robbed, his visitors tripped and fell, his dog bit someone, he feels I am liable. By including the renter's insurance, it gives me a chance to explain what a tenant is liable for, so if he kept $50,000 in jewelry in his apartment (assuming he even did), it got stolen, don't come to me and have me make good on it.

My mother in law had a tenant suing her because his apartment got robbed and sued, under the theory of, "of course the landlord has insurance". It was after this that I made sure I actually get a certificate of insurance from each of my tenants to make sure they really got the insurance.

My suggestion is find a good insurance agent, and discuss these issues. I used one for years, and found that in my business to be invaluable.