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Requiring all Customers to Accept SBOA Insurance

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  • Requiring all Customers to Accept SBOA Insurance

    Hello Everybody,


    Does anyone know if it is legal to require all rentals to take SBOA insurance? I have managed at 3 sites for 3 different companies and the requirement is always different, some sites require you to just have any form of insurance whether it is your own or a owner provided program and other sites make you sign a waiver either accepting insurance or accepting full responsibility for any loss. The recent site I have been managing requires you to only accept the operator provided program with no Opt out even if you carry home or renters insurance. If you don't take the operator provided program then you can not rent with us period. Is this legal?




    Thanks

  • #2
    Not sure if legal, depends on the state I guess. I have them sign the little tear out on the insurance brochure I give them and it states it is up to the tenant to take care of their own insurance and that we do not provide insurance at all. It is on them. I know lots here have them sign up for the insurance or not rent. I am dealing with at least an 18 year old and snowflake or not, they need to act like a grown up and take responsibility for themselves. We stay out of it. I do remind them that they need to check with their insurance provider to see if they have coverage with either home, renter's or business insurance and if it needs updated for the facility storage.
    "Never let the inmates run the asylum!"

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    • #3
      Originally posted by Certified View Post
      Hello Everybody,


      Does anyone know if it is legal to require all rentals to take SBOA insurance? I have managed at 3 sites for 3 different companies and the requirement is always different, some sites require you to just have any form of insurance whether it is your own or a owner provided program and other sites make you sign a waiver either accepting insurance or accepting full responsibility for any loss. The recent site I have been managing requires you to only accept the operator provided program with no Opt out even if you carry home or renters insurance. If you don't take the operator provided program then you can not rent with us period. Is this legal?




      Thanks
      Saying require to a customer will leave a bad taste in their mouth and is a tough conversation for you, the manager. It automatically puts the customer on edge.

      I have StorSmart Insurance at my facility. And it's not a required insurance program. It's a matter of having a conversation with the customer. So at my facility we've talked to every customer about the program and get 7/10 to sign-up for the insurance and rent 100% of the units without it being required.

      This is all with my wife managing the facility for the past 5 months and having ZERO prior experience in storage and not being in a customer facing position as is required of a manager.

      As a disclosure I am a part of StorSmart as an area director. I had the program in place at my facility for 3 months before taking on this role. So I saw the process benefit my facility and continue to see it. Would love to share anything else you'd like to know about the program.

      Comment


      • #4
        Certified What does the lease say. Ours say it's a material condition of the lease to have insurance. What it the policy of the facility? I don't think legal is the right word. I think the question might better be put is, " Is it illegal to require tenants to have SBOA insurance to rent." I believe, and I'm no attorney, is that it's not illegal. Some of us have strong lock policies where yo have to use a thumb or disk lock to store tor require DL. Is that illegal? No, it's policy I think the same would be true in this case. It's a requirement to rent.
        Chasing Perfection to catch Excellence

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        • #5
          Originally posted by Advantage IT View Post
          Certified What does the lease say. Ours say it's a material condition of the lease to have insurance. What it the policy of the facility? I don't think legal is the right word. I think the question might better be put is, " Is it illegal to require tenants to have SBOA insurance to rent." I believe, and I'm no attorney, is that it's not illegal. Some of us have strong lock policies where yo have to use a thumb or disk lock to store tor require DL. Is that illegal? No, it's policy I think the same would be true in this case. It's a requirement to rent.



          It says something to the effect of- to the occupants benefit they are provided insurance under a policy of the owner and named as additionally insured. But that is just what the contract states and it doesn't necessarily mean that it is true. There are a lot of legal loopholes in favor of the Facility Owner.

          For me I feel as if the customer already has a renters or homeowners insurance policy then why make it mandatory since the purpose of insurance is to remove facility liability. If the insurance is truly built into the rate then there probably shouldn't have to be a charge showing insurance aside from rent. I don't like to run a facility and not truly know what the truth is regarding the lease agreement because in the end it makes me out to be a liar.

          Comment


          • #6
            That sounds like a super slippery slope with that clause, scares the heck out of me that's for sure.

            A. A lot of why we do it is to put that wall of liability between tenant and owner. Why should the owner be responsible for the tenants stuff?
            B. It's revenue. Do the evaluation of what it's worth and it adds significant value. My stores have added value between $18K-$26K
            C. How nice is it to say just call this 800 number and they will take care of you.

            That's why you do it.



            Chasing Perfection to catch Excellence

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            • #7
              For the company I work for it is a requirement of the lease for the tenant to maintain insurance, but we never enforced it until fairly recently. We rolled out to all the sites the SBOA insurance for all tenants. They gave me a letter template to send out to all the tenants informing them to send in a copy of their homeowners or renters insurance, if not they would automatically be enrolled in the lowest coverage of insurance through SBOA. When new tenants come in we tell them that insurance is a requirement, but they are able to provide the homeowners or renters insurance at the time of sign up we can bypass the SBOA insurance, if not they could purchase the SBOA insurance and bring in their policy at a later date before their new rental period. If someone really objects to purchasing the insurance SBOA also sent me a form for the tenant to sign to assume all liability.

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              • #8
                You cannot require them to sign up for SBOA Insurance. Even SBOA's training modules go over that. You can require that they have some form of insurance coverage that fully coveted the value of the goods they are storing its up to them on whether or not at that point if they sign up for SBOA coverage or provide proof of homeowners coverage. I'm not an insurance agent, but for the protection and benefit of your customers, if they think their homeowners covers off-site self storage, I encourage them to reach out to their insurance company and check to see if they are fully covered (honestly most do not cover or have too high of a deductible to be worth it if something did happen, but we are not agents, so let their insurance explain that to them) . Also of note, the benefit off the SBOA is there is no deductible, so i recommend it to customers to get a smaller policy to use as a form of gap insurance to cover their insurance's deductible. Hope that helps!
                Laura

                Is there a method to my madness, or a madness to my method?

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