Can a property management company force tenants to buy a tenant liability policy from them?

I am currently renting a townhouse which is managed by a third-party property management company on the property owners behalf. I have always carried renters insurance through my insurance agent per the lease requirements. With my upcoming lease renewal I was notified that I am now required to pay the management company $10/month for a tenant liability policy. They indicated that I am not permitted to get a policy through any other source. This practice seems immoral at best and possibly illegal as they’re not allowing me to purchase my own insurance policy to meet their requirements. At the core it seems like a ploy to collect more money in their own pockets at the expense of their tenants.

Can anyone shed some light if they are allowed to do this?

Asked on June 25, 2017 under Real Estate Law, Ohio


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

Yes, they are allowed to do this when the lease comes up for renewal. (They cannot make this change or interpose this requirement during the term of a still-in-effect or unexpired lease.) It may be greedy and immoral, but it is legal: there is no inherent right to select your own insurer, and a landlord (or the property manager on the landlord's behalf) is not only free to specify that tenants must have insurance, but also to specificy the parameters of the policy and where and from whom it must be purchased: tenants must decide if they are willing to comply with that requirement of if they will not renew the lease or rent here. A tenant who does not want to rent under those conditions can look for a rental unit from someeone else.

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