
Lessors Risk Insurance
The last thing you want is for your rental property to become a financial burden; but if someone steals from your lessee, you could be financially responsible. To avoid this type of disastrous situation, it is a good idea for all landlords to obtain lessors risk or LRO insurance. This type of policy protects you from liability in case something happens to your tenant’s property.
Eligibility
Specific regulations may vary from state to state, but the following are some general requirements of LRO policyholders:
- Own a property that you lease to others
- Rent out at least 75% of the area within the building
- Keep up with regular maintenance
- Modernize any outdated electrical or plumbing systems
- Fix roof or siding damage
Types of Rental Properties
Many kinds of rental properties can be covered by LRO. Here are a few of them:
- Laundromats and dry cleaners
- Restaurants
- Office spaces
- Shopping centers
- Warehouses
- Convenience stores
Coverage
Types of loss usually covered include:
- Theft
- Damage by natural causes
- Vandalism
- Loss of tenant’s customers’ property
- Bodily harm
According to www.iwains.com, niche markets can experience unique situations not encountered by more traditional businesses, and some of these situations no doubt arise between landlord and tenant. You can protect your investment from your tenants’ potential misfortunes with LRO insurance.