Kraig Kast
Atherton Insurance Services
Protect your residents and your bottom line.
In this era of shrinking budgets, increasing costs, and volatile vacancy rates, owners and management companies in the student housing sector are searching for new ways to protect their bottom line. Today’s security deposits are inadequate to cover damage due to resident negligence, which result in more losses to the owner/manager that cut deeply into the bottom line. Luckily, renters insurance is here to help.
Over the years, property managers have misunderstood renters insurance. They believed it was strictly for the protection of their residents, and they simply recommended it to them upon move-in. In addition, parents are under the mistaken belief that their homeowners insurance will cover their children when they are not living at home.
Today, student renters insurance also offers substantial protection for the property owner and the management company. Damage to the building from accidental kitchen fires, overflowing bathtubs and toilets, carpet cuts and stains, damaged countertops, broken windows, etc., are covered under the liability portion of the student renters insurance policy. This is beneficial to the property owner/manager in several ways:
The owner/manager is not paying for damages or the insurance deductible out of the operating revenue.
The owner/manager does not have to file an insurance claim. Fewer claims save money in premiums, when the policy renews.
The owner/manager can avoid resident-related property insurance claim issues with the renters policy in place.
The owner/manager can use the owner renters insurance program as a marketing advantage.
The owner sponsored renters insurance program can aid in resident retention.
Riders for pets and other coverage benefits the owner/manager and the resident.
Student renters insurance also covers the resident’s belongings in the case of theft, even when stolen from their automobile. Plus, the resident’s liability coverage protects them wherever they go, not just in their apartment. These are a couple of misunderstood facts that your residents will find very important.
Recent technological advancements in Internet speed and real-time interface capability have made it possible for leasing office staff to market, monitor, and track their student resident’s renters policies. These programs are convenient and affordable, averaging between $10 to $15 per month for $50,000 of liability and $120,000 of property damage (the actual cost varies by region and property). New software and interactive portals now offer a level of protection not seen before in the industry. Not since online credit screening became feasible in the late 1990s has such a powerful tool for protecting your bottom line been available.
There are three major providers of owner sponsored renter’s insurance programs. Each has its own advantages. Renters insurance programs have been successfully implemented in large multifamily communities, small privately owned apartment buildings, senior living communities, private schools and state and private colleges and universities.
— Kraig Kast is President of Atherton Insurance Services, a unit of Atherton Trust Co., which can be found on the Web at www.athertontrust.com.