An insurance addendum to a residential lease requires the tenant to obtain insurance that covers any type of liability for damage to a neighbor’s property and for any personal property loss. The main reason a landlord will require renter’s insurance for a tenant is to limit their liability in the chance the tenant injures themselves on the property. With renter’s insurance, it is far less likely for a tenant to sue the landlord or for another party to make a lawsuit due to the tenant’s actions.