Clause (iii) of paragraph (b) of subsection (1) of section 15B of chapter 186 of the General Laws, as appearing in the 2020 Official Edition, is hereby amended by inserting after the words “subsection (2)”, the following words:-

provided however, that instead of requiring payment of a security deposit, a lessor and a tenant or prospective tenant may agree to a fee for the purchase of security deposit insurance. The lessor shall utilize the security deposit insurance fee to purchase insurance coverage for unpaid rent or unit damage that applies to that tenant’s lease. The security deposit insurance fee may: (A) be entirely or partially non-refundable, if disclosed in the lease and separately agreed to by the tenant; and (B); (C) be a recurring monthly fee, or payable upon any schedule and in an amount that the lessor and tenant choose, the total of which shall not exceed the first month’s rent. A court, arbitrator, mediator or any other dispute resolution adjudicator shall not consider a security deposit insurance fee to be a security deposit or consider it to be governed by any laws or regulations governing security deposits. A lessor shall not be obligated to offer a security deposit insurance fee option, but if a lessor chooses to offer the insurance fee option, they shall: (1) ensure that it is optional for the tenant, and that the tenant may choose to pay a full security deposit rather than a security deposit insurance fee; (2) not use a prospective tenant’s choice to pay a security deposit insurance fee or a traditional security deposit as a criterion in the determination of whether to approve an application for occupancy; (3) offer the insurance fee option to every prospective tenant whose application for occupancy has been approved, regardless of income, race, gender, disability, sexual orientation, immigration status, size of household or credit score; and (4) allow any tenant that agrees to pay a security deposit insurance fee to opt-out of a continuing security deposit insurance fee obligation upon full payment of the security deposit that is otherwise in effect for the tenant’s apartment on the day of the opt-out;