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Steps for Property Managers to implement the Tenant Liability Insurance Program (TLI)

We recommend you have your attorney review any additions to legal documents

Here are the steps to implement TLI:

Disclosure to Current Owners:

Step 1:  Send notice to your current owners informing them of this new program.  Sample Notice/Email.

We recommend you send this notice through your management software so you have proof of notice.

For New Lease Agreements:

Step 1: Add or Combine to include in any published Screening Criteria and on your Rental Home Application.  Use the “TLI – Screening Criteria and Addendum Form”  

Step 2: Post Screening Criteria to your Website or Multiple Listing Service.

(INTENT: Disclose up front wherever possible to new applicants before they apply!)

Step 3:  Add the “SureVestor Addendum – Tenant Liability Insurance” into your Lease Packet.

Step 4:  Tenant Signs New Lease Agreement to include TLI Addendum.

Step 5:  Tenant flyer for your lease packet.

Step 6:  After creating a new GL Account in your accounting system (GL 5050 for example) – ADD the Tenant Liability charge of “$XX” to the tenant monthly ledger for payment.

EXISTING LEASE AGREEMENTS PENDING RENEWAL or on month to month lease:

Step 1:  Disclose to tenants as far out as possible the policy change of adopting Tenant Liability Insurance for all lease renewals. Allow for a minimum of 30-60 days before mandating on any lease renewals.  

You can include this flyer in the notice to tenants: Flyer

INTENT: Give your existing tenants plenty of time to digest this policy, and to allow for the implementation of the New Leases to smooth out.  This ties into the timeline established above.

Step 2:  Add to your Lease Renewal Notice the “TLI –Sample Notice Email Template”  This combined form can both inform the tenant of new policies – AND – ask them for their upcoming plans with the home in writing.  At a minimum, inform the tenant of this upcoming policy change via email and mail as needed 45 to 60 days from any renewal actions or per your state required statute, if any.

Step 3:  Have renewing tenant sign the TLI – Addendum Form or incorporate into your lease agreement.

Step 4:  Once a new lease or lease addendum is signed – Add Tenant Liability Policy to the tenant’s monthly ledger.

WARNING:  Tenants do not like changes in lease agreement terms while living in a home.  We recommend fully disclosing this to Owners well prior to ever disclosing this to existing tenants and disclose this policy update well in advance of pending renewal.
CAUTION: If Owners have insisted on connecting with Tenants – an existing Tenant will run to an owner and complain about new charges and policies being put into place.  This is why you want to inform ALL owners of the new policies with disclosures and updates being sent out.

ACCOUNTING IN YOUR SOFTWARE:

Step 1:  Create a new General Ledger (GL) account for Tenant Liability Insurance.  Example: GL5050

Step 2:  Once the new or existing tenant has signed up – add in their recurring monthly charge on the tenant ledger.  

Step 3:  Ensure the new GL Charge falls in line with other administration fees so the charge goes to the Property Manager and not the owner.

FULL IMPLEMENTATION:

To reach full implementation, it may take 12-24 months depending on your lease agreement cycle and rules / regulations on imposing changes to a lease agreement during its initial term.  

FUTURE OWNER DISCLOSURES:  As your affiliation with SureVestor grows, it may become necessary to disclose to your Owners and Tenants that your company receives an admin fee for offering this preferred vendor policy with our Tenant Liability Policy.  

Should you have any detailed questions about implementing this policy into your business, contact us!