Key Takeaways
- Tennessee law does not require a tenant to purchase renters insurance. In counties covered by the Uniform Residential Landlord and Tenant Act, the law requires the landlord or landlord’s agent to advise the tenant in writing that the landlord is not responsible for, and will not provide, fire or casualty insurance for the tenant’s personal property. Tenn. Code Ann. § 66-28-201(a).
- That written advisory is the legal minimum. It does not provide insurance coverage for the resident’s belongings or eliminate the potential for liability claims arising from a resident’s actions.
- RENEW’s lease requires renters insurance with personal liability coverage of at least $100,000 per occurrence, along with coverage for the resident’s personal property.
- Residents can use any carrier whose policy meets the lease requirements. They can upload proof from their own carrier or purchase a policy through the tenant portal using FolioGuard.
- If a resident moves in without required coverage, or allows the policy to lapse, RENEW places Liability to Landlord Insurance (LLI) on the unit at $15 per month, billed to the resident. LLI is designed to protect the owner’s interest; it does not replace renters insurance or cover the resident’s belongings.
- Renters insurance does not replace the owner’s landlord policy. The two policies serve different purposes, and owners still need appropriate property and liability coverage.
Renters insurance is one of those lease requirements that can seem unnecessary until the day something goes wrong.
A resident leaves a bathtub running. A washing-machine hose fails. A kitchen fire causes smoke and water damage. A guest is injured. A resident’s dog bites someone.
When something like that happens, the questions come quickly: What caused the loss? Who is responsible? Which policy might respond? What are the coverage limits and deductibles?
Tennessee law does not require tenants to buy renters insurance. It does, however, require landlords to tell tenants in writing that the landlord will not insure the tenant’s personal property.
At RENEW, we go further. Renters insurance is a lease requirement, with at least $100,000 in personal liability coverage and coverage for the resident’s belongings. We require proof of coverage and monitor the policy information. If required coverage is missing, we have a fallback process that protects the owner’s interest while the resident gets the lease requirement corrected.
This article explains what Tennessee law actually requires, what RENEW’s lease requires, how our verification and fallback process works, and how renters insurance differs from the owner’s landlord policy.
General information for Nashville and Middle Tennessee rental owners. This is not legal or insurance advice. RENEW does not underwrite resident policies. Coverage questions should be confirmed with the applicable insurance carrier, and legal questions with a Tennessee attorney.
What Tennessee Law Actually Requires
In counties covered by the Uniform Residential Landlord and Tenant Act — including Davidson County and other large Middle Tennessee counties — Tenn. Code Ann. § 66-28-201(a) requires the landlord or landlord’s agent to advise the tenant in writing that the landlord is not responsible for, and will not provide, fire or casualty insurance for the tenant’s personal property.
That is a mandatory written advisory. It is not a statutory requirement that the tenant purchase renters insurance.
Two other points are important.
First, a lease can include requirements that Tennessee law does not prohibit. Requiring a resident to maintain renters insurance is therefore a contractual lease requirement, not a Tennessee statutory insurance mandate.
Second, a lease cannot simply eliminate rights that Tennessee law gives a tenant or transfer the landlord’s own liability to the tenant. Tenn. Code Ann. § 66-28-203 places limits on provisions that attempt to excuse a landlord from the landlord’s own negligence or require a tenant to indemnify the landlord for that liability.
So the distinction is straightforward.
What the law requires vs. what the RENEW lease requires
Written notice that the landlord does not insure the tenant’s personal property
Tennessee statute: Yes
RENEW lease: Yes
Tenant must maintain renters insurance
Tennessee statute: No
RENEW lease: Yes
Minimum liability limit
Tennessee statute: No statutory amount
RENEW lease: $100,000 per occurrence
Proof of coverage
Tennessee statute: Not required
RENEW lease: Required. If acceptable proof is not in place, LLI is placed on the unit.
Coverage maintained throughout the lease
Tennessee statute: No
RENEW lease: Yes. A lapse puts the unit back on LLI.
Fallback when required coverage is missing
Tennessee statute: No statutory LLI requirement
RENEW lease: LLI may be placed on the unit and billed to the resident.
The statute tells the resident: Don’t assume the owner’s policy covers your belongings.
The RENEW lease adds: Maintain your own renters insurance that meets the lease requirements, or landlord-protection coverage may be placed on the unit and charged to you.
Those are different things.
What RENEW’s Lease Requires
Section 4.5 of the RENEW lease requires every adult occupant on the lease, at their own expense, to:
- Obtain a renters insurance policy before occupancy.
- Keep that policy in force for the entire lease term.
- Carry personal property coverage for covered losses such as fire, theft, vandalism and other covered perils.
- Carry personal liability coverage of at least $100,000 per occurrence.
- Provide RENEW with a certificate of insurance or other acceptable proof of coverage before move-in and when the policy renews.
Failure to maintain the required coverage is a material breach under the lease.
If required coverage is missing or lapses, the lease gives RENEW the ability to place Liability to Landlord Insurance on the unit and charge the resident for that cost. In our operation, that is not a theoretical provision. It is the fallback process we use.
The important difference is between recommending insurance and requiring and verifying it.
A lease that says “we strongly recommend renters insurance” leaves a very different operational situation than one that establishes a coverage requirement, specifies a minimum liability limit, requires proof and provides a process when coverage disappears.
Why Owners Should Care
The owner’s landlord policy and the resident’s renters policy are designed for different risks.
An owner’s policy generally addresses the building and the owner’s interests — including the structure, certain fixtures and the owner’s liability arising from ownership, depending on the policy. It may also provide coverage for loss of rental income after certain covered events.
A renters policy generally addresses the resident’s personal property and personal liability, subject to the policy’s terms, exclusions and limits.
That distinction matters in everyday rental situations.
The resident’s belongings
A tenant’s clothes, furniture, electronics and other personal property are not automatically covered by the owner’s landlord policy simply because they are inside the rental property.
That is one reason Tennessee law requires the written advisory in § 66-28-201(a).
A resident who wants protection for their belongings needs appropriate coverage under their own policy.
The resident’s liability
A renters policy may also provide personal liability coverage for certain claims involving the resident, including some claims arising from accidental damage or injury for which the resident is legally responsible.
That does not mean every claim is automatically covered. Coverage depends on the circumstances and the policy’s terms, exclusions and limits.
Common situations that can create questions include:
- An overflowing bathtub or failed washing-machine hose damages flooring, cabinets or another unit.
- Unattended cooking causes fire, smoke or water damage.
- A resident’s dog bites a guest or another person.
- A guest is injured at the property.
- A resident’s actions cause accidental damage to the rental home.
The point of requiring liability coverage isn’t to guarantee that every loss will be paid by the resident’s insurer. It is to make sure a qualifying liability policy exists when a covered claim arises.
A Security Deposit Is Not a Substitute for Insurance
A security deposit and insurance serve different purposes.
A deposit is a defined amount held and applied according to the lease and Tennessee law. It is not liability insurance, it is not contents coverage, and it is not designed to absorb a major fire or water loss.
Likewise, a lease provision stating that a resident is responsible for damage does not create an insurance policy.
That is why RENEW treats the security deposit, the lease’s liability provisions and renters insurance as separate pieces of the risk-management process.
A Tennessee Legal Wrinkle: The Sutton Rule
There is another Tennessee issue worth understanding, particularly for rental owners.
Tennessee courts have recognized what is commonly called the Sutton rule. In general terms, when a tenant is treated as an insured or co-insured under the landlord’s property insurance arrangement, the landlord’s insurer may be limited in its ability to pursue the tenant through subrogation after paying a covered property loss.
The Tennessee Court of Appeals addressed this issue again in Patton v. Pearson (2023), involving a Nashville-area house fire.
The important point for owners is that Sutton is primarily about the relationship between the tenant and the owner’s property insurer. It does not mean the tenant’s own renters insurance is unnecessary.
It also does not mean an owner can eliminate the owner’s property insurance.
Think of the policies as serving different roles:
- The owner’s landlord policy protects the owner’s property and interests, subject to that policy’s terms.
- The resident’s renters policy protects the resident’s personal property and may provide personal liability coverage for qualifying claims.
- Sutton can affect whether an owner’s insurer can seek recovery from a tenant after paying a covered property claim.
For that reason, requiring residents to maintain their own liability coverage remains a useful part of a professionally managed rental program.
And a security deposit or lease provision requiring a resident to pay for damage is still not the same thing as having an active liability insurance policy.
Sutton is a legal issue worth understanding, but it is not a reason to skip renters insurance and it is not a reason for an owner to drop the owner’s landlord policy.
What Renters Insurance Does Not Do
Renters insurance does not:
- Replace the owner’s landlord or dwelling policy.
- Automatically cover every type of property damage.
- Cover ordinary wear and tear or routine move-out cleaning.
- Transfer the owner’s legal duty to maintain a habitable property.
- Eliminate the need for appropriate repairs after a loss.
- Guarantee coverage for intentional acts, excluded causes of loss or claims exceeding policy limits.
Coverage is ultimately determined by the resident’s actual policy, including its definitions, exclusions, limits and deductible.
Owners still need their own insurance with coverage appropriate for the replacement cost of the property and the liability exposure associated with owning a rental.
Resident insurance sits next to the owner’s insurance. It does not replace it.
How Renters Insurance Works at RENEW
A requirement that is never checked is little more than a suggestion. We do not treat this one that way.
The standard
RENEW wants a qualifying renters policy in force before keys are issued. The lease establishes the requirement, and our rental qualifications process reinforces it.
Residents have two options
- Purchase through the tenant portal. FolioGuard renters insurance, offered through AppFolio Insurance Services, is available through the same tenant portal residents already use for other rental-related tasks. The available product includes personal liability coverage and contents coverage.
- Use another insurance carrier. Residents do not have to purchase FolioGuard. They can use their existing insurance company or another renters insurance provider as long as the policy meets the requirements of the lease. Proof of coverage can be uploaded through the tenant portal.
RENEW does not select the resident’s insurance carrier. We require qualifying coverage and proof that the coverage is active.
Renewal reminders
Once policy information and expiration dates are recorded, residents receive reminders as renewal approaches.
The objective is simple: maintain coverage continuously rather than discover a lapse after a loss.
What Happens If There Is No Policy?
If a resident moves in without the required renters insurance, or a policy later lapses, RENEW places Liability to Landlord Insurance (LLI) on the unit at $15 per month and bills that cost to the resident, consistent with the lease.
The purpose is to protect the owner’s interest while the resident’s lease requirement is not being satisfied.
LLI is not renters insurance.
It does not provide the resident with coverage for their furniture, clothing, electronics or other personal belongings.
For many residents, a basic renters policy can cost roughly the same neighborhood as the $15 monthly LLI charge, depending on the carrier, property, deductible, coverage limits and other factors. The important difference is what the resident gets for the premium.
A qualifying renters policy can provide coverage for the resident’s belongings and personal liability. LLI is designed for the landlord/owner interest.
Once acceptable renters insurance is provided, the LLI placement is removed according to the applicable process.
Real Renters Insurance vs. LLI at $15 a Month
Primary purpose
Renters insurance protects the resident — belongings and personal liability, subject to that policy.
LLI is written for the landlord/owner interest.
Resident’s furniture, clothing, and electronics
Renters insurance: yes, subject to limits and covered causes of loss.
LLI: no.
Resident personal liability
Renters insurance: yes, subject to terms and limits.
LLI: not a resident personal-liability policy.
Resident-caused damage to the building
Renters insurance: may apply, subject to the policy.
LLI: owner-side protection, subject to the LLI policy.
Does it satisfy RENEW’s renters-insurance requirement?
Renters insurance: yes, if it meets the lease.
LLI: no. It is the fallback when required coverage is missing.
What the resident pays
Renters insurance: varies by carrier, limits, deductible, and address.
LLI at RENEW: $15 per month, billed to the resident.
LLI is how RENEW keeps an owner from sitting uncovered when the required policy isn’t there. It is not a substitute for a real renters policy.
What Owners Should Look For
If you are evaluating a property management company, don’t just ask whether the lease “recommends” renters insurance.
Ask how the company actually manages it.
A useful renters-insurance program should answer questions such as:
- Is renters insurance required by the lease?
- Is there a minimum liability limit?
- Is proof of coverage collected before move-in?
- Is coverage monitored through the lease term?
- What happens when a policy expires or is canceled?
- Is there a documented fallback process?
- Does the fallback coverage protect the resident, the owner, or both?
- Does the management company distinguish renters insurance from the owner’s landlord policy?
The requirement matters. The process behind the requirement matters too.
Frequently Asked Questions
Does Tennessee law require tenants to have renters insurance?
No. Tennessee law requires the landlord or landlord’s agent to advise the tenant in writing that the landlord is not responsible for, and will not provide, fire or casualty insurance for the tenant’s personal property. Requiring renters insurance is a lease requirement, not a statutory requirement.
Why does RENEW require $100,000 in liability coverage?
Tennessee law does not establish a $100,000 renters-insurance minimum. $100,000 per occurrence is the minimum liability coverage required by RENEW’s lease.
Do residents have to buy FolioGuard?
No. FolioGuard is an option available through the tenant portal. Residents may use another insurance carrier as long as the policy meets the lease requirements and acceptable proof is provided.
What if a resident already has renters insurance?
A policy from a previous apartment may work if the address is updated, the policy meets the $100,000 liability requirement, the coverage dates include the resident’s occupancy and current proof is provided.
A policy written for a different address is not proof of coverage for the RENEW-managed property.
What happens if a resident moves in without renters insurance?
RENEW places LLI on the unit at $15 per month and bills the resident for that coverage, consistent with the lease. The resident can satisfy the renters-insurance requirement by purchasing qualifying coverage through the portal or providing proof of a qualifying policy from another carrier.
What happens if a resident lets their policy lapse?
The unit is placed back on LLI at $15 per month. The resident must restore qualifying renters insurance to satisfy the lease requirement.
Does LLI cover the resident’s belongings?
No. That is one of the most important distinctions between LLI and renters insurance.
LLI is designed to protect the landlord/owner interest. It does not replace coverage for the resident’s furniture, clothing, electronics or other personal property.
Does renters insurance cover the security deposit?
No. A security deposit and insurance are different things. The deposit is handled under the lease and applicable Tennessee law. Insurance responds only to losses covered by the applicable policy.
Can the owner drop their landlord insurance because the resident has renters insurance?
No.
Resident renters insurance does not replace the owner’s landlord/property insurance. RENEW’s management agreement requires owners to maintain appropriate property insurance.
The Longer View
At RENEW, we look at renters insurance the same way we look at other risk-management requirements.
The goal isn’t to add another box to check. The goal is to have a defined process before something goes wrong.
Tennessee law requires owners to tell residents that the owner’s insurance does not cover the resident’s personal property. RENEW’s lease goes a step further by requiring qualifying renters insurance, establishing a $100,000 liability minimum and requiring proof of coverage.
If that coverage disappears, RENEW has a documented fallback rather than simply hoping the resident fixes it before a loss occurs.
For residents, a real renters policy can provide something LLI cannot: protection for their own belongings and personal liability coverage, subject to the policy’s terms.
For owners, renters insurance is not a replacement for the landlord policy. It is another layer in a professionally managed rental property’s risk-management process.
If you are considering professional management for a Nashville or Middle Tennessee rental property, RENEW can explain how our leasing, insurance verification, maintenance and ongoing management processes work. Start with a free rental analysis or call 615-800-8490.
