Yes, a landlord can require a tenant to have insurance as a term of the lease. It is up to the tenant as to whether or not to agree to that term. Tenants can try to negotiate this term with the landlord.
A basic tenant insurance policy will include liability coverage, which is intended to help tenants with situations where they may be found at fault for damage caused to a third party, another suite, or the building. For example, if a fire starts in the tenant’s apartment and it causes damage another suite, liability insurance will help cover the costs of the damage caused to the tenant’s unit and the other suite.
Tenant insurance can also include contents insurance, which will help cover the replacement cost of the tenant’s goods and personal items if they are destroyed by fire or water damage. A tenant’s items are not covered by the landlord’s insurance and tenants without insurance will not receive any compensation if their items are destroyed.
If the landlord requires the tenant to have insurance, then the landlord can require the tenant to provide proof of that insurance. The landlord may require this proof only once, or on an annual basis.
Many tenants have insurance even when it is not required under the lease just in case an emergency were to occur.
For more information read our blog posts The Joys of Winter, and the Wonder of Insurance Policies and More Stuff I Wish I’d Known Yesterday.