Accidental Fire Caused By Tenant

Published on May 11th, 2023

If a fire, possibly initiated by a faulty alarm or sprinkler system, happens at a rental property resulting in damage to the building and its contents, who is liable? Navigating the complexities of liability in such scenarios can be a daunting thing, but understanding the processes can help you achieve a fair result.

Owning a rental property can be a lucrative venture for landlords, but it also comes with stress, dealing with rental insurance coverage, landlord's insurance, making sure your tenant is paying rent, and ensuring that a legal rental agreement is in place. In addition to these responsibilities, landlords must also be prepared for unforeseen incidents involving their property and tenants, such as a blaze in an apartment, smoke damage, and even injuries due to fire. Seeking professional advice from insurance experts or legal counselors can help you better handle liability matters.

What happens when the unthinkable occurs at your property - an accidental rental property fire caused by your tenant? What impact would this have on you and others? In this case, dealing with the losses and logistics from the incident might be overwhelming, especially considering the damage to the structure itself.

Throughout this article, we will give you a step-by-step guide on dealing with renters insurance, the fire department, and what you, as a property owner, can do after a fire has affected your apartment complex or building.

The Statistics of Fire Damage at Rental Properties

There are an estimated 100,000 rental property fires in any given year, causing billions of dollars worth of damage to rental properties and hundreds of insurance claims, according to the National Fire Prevention Association. Inherent in this are the losses for landlords and their clients.

While the cause of the fire might be different in each situation, it doesn't change the fact that your property is now damaged, causing you to lose rent on a rental unit (lost wages in your pocket) and displacing a tenant. How the details of the cause and the equipment used to address it, such as a sprinkler system, will affect insurance claims is another question entirely.

Your First Steps as a Landlord After a Fire Causes Property Damage

As a landlord/ property owner, it's essential that you collect as much information about the fire as possible, completing your own investigation by asking your tenants questions to see if they know the root cause of the fire. Make sure to involve an attorney, if necessary, to assist you in any legal action that may arise.

The fire department's report will also outline why they believe the fire started. If your tenants caused a fire by accident, like they lit a candle and knocked it over, you need to know. Damage caused by a fire can be extensive, and restoring the home to a habitable condition will take time - what can you do for your tenant's inconvenience in the meantime?

Depending on the cause of the fire at the rental property, the rights and responsibilities of both parties involved, and the terms of the lease provisions that you and your tenants have agreed to, you may have to help your tenant find new housing. For instance, if the fire originated in the kitchen due to a faulty appliance, the landlord may bear more responsibility to find alternative living arrangements within the scope of the lease.

Also, depending on where your property is located, the property owner might have to front the costs associated with relocating tenants. Typically, these costs are reimbursed by your insurance company once your insurance claim is finalized. If a landlord pays the costs of relocating a tenant, it's important to keep an accurate record by both the homeowner and the tenants of these efforts after a rental property fire. Leases often contain clauses outlining the rights and responsibilities of both parties in case of such an incident. In any case, it's crucial to maintain open communication and work together in addressing the charred incident and the aftermath. Along with authorities, family members should also be in touch to provide care and support during this challenging time.

Also, depending on where your property is located, the property owner might have to front the costs associated with relocating tenants. Typically, these costs are reimbursed by your insurance company once your insurance claim is finalized. If a homeowner pays the costs of relocating a tenant, it's important to keep an accurate record of both the homeowner and the tenant of these efforts after a rental property fire. Make sure to get a copy of all relevant documents from your insurer to help with any related matters, and consult an author or expert in such cases for guidance.

A good place to start in helping your tenants find suitable housing would be to contact the local Red Cross or see if the fire department has any contact. These authorities may provide valuable information about temporary housing options following an inferno.

Connecting With Your Insurance Provider to Check Your Insurance

Whether your property is completely destroyed or has sustained minor damage caused by a fire, it's important to reach out to your insurance company right away to begin a claim. Discuss all the details of the fire with your insurer and your attorney, if needed, before making any final decisions about reparations.

You will have to pay the landlord's deductible rate to your insurance company, which will be far less costly than the repairs if the property damage is severe. Most landlord's insurance policies will cover the burned and scorched damages and certain costs associated with fire damage and water damage associated with quelching a fire.

If the property is a total loss, it's up to the insurance company and the fire department to determine who is at fault, then the landlord's responsibility is to decide whether or not to rebuild.

Reaching out to your insurance completely immediately after fire damage occurs at the premises should be at the top of your list, as processing a claim does take time.

Working with Your Tenant's Rental Insurance Coverage

In most states, tenants are required to purchase a renters' insurance policy or renter's policy to cover damage that goes beyond the amount of their security deposit. If a tenant is found responsible for a fire, they will also be responsible for some of the costs associated with the landlord's repair efforts, as part of the provision within their insurance policy.

As a landlord, you will want to work within your lease terms and with both your property insurance and the renter's insurance to cover the costs of the repairs on the house.

Final payment for the repairs will come from the insurance companies involved.

Once you are ready to start the repair work on your property, you will need to get in touch with a fire restoration company to assess the damage and provide quotes to your insurance company for the work.

The fire restoration company will be able to answer any questions you might have about repairs and a timeline for when your property will be habitable once again.

To find a trusted local fire restoration company, reach out to your local fire department, friends and family, or ask your insurance company for their suggestions.

Things happen, and fires can destroy rental properties despite a tenant and landlord's best efforts. Know that there are solutions to restore your property, find a new home for your tenants, and insurance in place to help cover the cost of repair work and cover the loss of non-payment from your rental unit.

For more information on property fires and how to handle them, please check out our blog.