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Insurance Requirements Concern Tenant, but They Are Legitimate
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Parts of the cabinet were burned. My landlord is insured for such events, but I don't have renter's insurance.
My landlord's insurance company is going to pay for the damage and then demand that I reimburse it. The accident was my mistake, but isn't that what the insurance company is supposed to cover? Am I legally required to pay for damage even though my landlord has insurance?
A: Property manager Griswold replies :
You are responsible, and the owner's insurance company is reasonable to seek reimbursement from you for the expenses it incurs in covering this claim. While every landlord should have insurance, the owner's insurance is not to protect them from situations that are created by their tenants. Insurance for landlords is not like "no-fault" car insurance. The key question is: Who is liable?
If the situation were reversed (as it often is) and something happened (like a fire resulting from a malfunctioning electrical outlet in your rental unit or another unit) and your personal property were destroyed, you would submit a claim to your renter's insurance carrier and it would pay you and then subrogate (seek reimbursement) against the owner's insurance policy because the owner is liable for the cause of the fire.
In this situation, the fact that your negligence in starting the fire was unintentional doesn't change your responsibility.
It has been my experience that many fires are caused accidentally by tenants while cooking or by unintentional tenant negligence through improper use of appliances or extension cords. That is one of the reasons renter's insurance is a good idea and worth the few hundred dollars per year. Negotiate some sort of payment plan with the insurance company, and then immediately check into a renter's insurance policy.
This column on issues confronting tenants and landlords is written by property manager Robert Griswold, author of "Property Management for Dummies" and co-author of "Real Estate Investing for Dummies," and San Diego lawyers Steven R. Kellman, director of the Tenants Legal Center, and James McKinley, principal in a law firm representing landlords. E-mail your questions torgriswold.inman@retodayradio.com. Questions should be brief and cannot be answered individually.
Copyright 2008 Inman News
Distributed by Inman News
