by Brandon Tobman
In an industry that already presents various risks to operators, the last thing they should have to worry about is renters insurance and making sure that residents are in compliance. While renters insurance is a standard requirement for living in an apartment community, not all renters have it. That alone is not only a tremendous risk for operators, but also expensive for their property insurance.
With nearly 60 percent of renters residing in a community devoid of any renters insurance, operators are reluctantly having to carry the burden of risk should anything happen requiring an insurance claim. There are multiple reasons that operators should be sure that every resident holds an up-to-date renters insurance policy, including:
- Relocation expenses due to natural disasters or fires
- Protection against property damage
- Damage or injuries from pets
- Reducing the risk of a lawsuit
- Screening potential residents with proof of renters insurance (this might be an indicator of a potential resident’s ability to pay rent on time)
Renters insurance compliance impacts operators tremendously and the risks cannot be ignored. However, monitoring each and every resident for insurance compliance is a cumbersome task that no onsite teams have the time for. With limited options, companies have started looking into third-party partnerships and solutions like insurance technology to meet compliance requirements and gain the ability to proactively track policies and immediately know once a policy is canceled or must be renewed.
InsurTech services monitor residents’ renters insurance policies for validity as well as offer options for new and non-compliant residents to purchase an affordable and customized policy with just a few clicks of a button. Onsite teams no longer have to overextend themselves tending to such a tedious task and operators can rest assured that their asset is completely protected if an unforeseen event should occur.
The property insurance that operators carry covers a community and the structures encompassed within that, but if a resident loses their belongings to theft, fire or any other disaster, renters insurance is what supplements those losses. However, if a resident doesn’t have proper coverage, operators may unknowingly be liable for damages outside of personal belongings. Insurance is one of the largest expenses for operators, and they want to keep their claims lower for a cleaner record so when it comes time for renewal, they can push for a lower property rate.
For example, if a resident who does not have renters insurance causes a fire or flooding in their apartment home, their belongings are still their responsibility, but any damage done to other units or the building structure is subject to deductibles and will hit the operator’s track record. Without liability insurance, repair costs have to be paid by the operator’s insurance coverage and the property insurance will inevitably go up.
Operators want to do everything within their power to keep their property insurance policy in good standing and get the most affordable rates possible. Keeping those costs down allows for rental rates to remain lower, which every resident can appreciate.
InsurTech services use technology to seamlessly monitor the compliance of every single resident, and simplify purchasing insurance if residents need it. Operators can once again have confidence in the way their communities are cared for and onsite teams gain back the time required to attract and retain quality residents.