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What is renters insurance and what is its coverage?

While moving into a new apartment can be worrying, don’t forget to get renters insurance coverage in case of an emergency. 

This article provides answers to all possible questions related to a renters insurance policy. Please read carefully.

What is renters insurance?

Renters insurance is property insurance that provides coverage for the policyholder’s belongings, liabilities, and possibly living expenses in the event of an event of loss.

Provided to renters or sub-tenants of single-family homes, apartments, duplexes, condominiums, studios, lofts, and townhomes.

The coverage covers losses to the tenant’s personal belongings while residing in the rental unit. 

The renters insurance policy also covers losses resulting from liability claims, such as injuries sustained on the premises that are not caused by a structural problem with the property (in which case the owner’s policy would apply, not the renter’s). .

Getting a renters insurance policy, probably the least expensive and easiest insurance you’ll ever get, could be a good investment, even if you’re just starting out or living somewhere for a year.

Do I need renters insurance?

In most cases, you will only need renters insurance if your landlord or the building you live in requires it. Where not explicitly required, it is recommended that you obtain renters insurance if you are renting any type of apartment long-term. 

Most apartments usually have insurance coverage that covers damage to the building and not your belongings. To protect your personal valuables from fire, theft, or damage of any kind, you should get renters coverage.

While getting renters insurance may not stop bad things from happening, it does make life easier and safer. Here are some reasons why you need a renters policy:

Your landlord’s insurance won’t cover you

Some landlords require their tenants to get renters insurance, but that doesn’t mean you’re protected.

“Many renters feel that because their landlord has insurance, damage to their property is covered.” This is not the case, according to Wissner-Levy.

The structure of the building is covered by the owner’s insurance, but not the personal possessions of the tenants.

Your landlord’s insurance probably won’t cover the cost of replacing your TV or dishes if they’re stolen or destroyed in a kitchen fire, but a renters policy might.

It is cheap

The average monthly cost of renters insurance is $14 a month. This cost depends on factors such as how much coverage you need, the type of coverage you choose, the amount of your deductible, and where you live.

Protect your personal property

Renters insurance coverage protects your personal belongings, such as clothing, jewelry, luggage, computers, furniture, and electronics, from loss.

Even if you don’t have much, you may soon be racking up a lot more than you think and a lot more than you’d want to pay to replace it all.

Standard insurance does not protect against losses caused by floods or earthquakes. These perils require a separate policy or clause. In storm-prone locations, a rider may be required to cover wind damage.

Also, renters insurance coverage does not cover losses caused by your own negligence or deliberate actions.

For example, if you fall asleep with a lit cigarette and start a fire, your insurance policy is unlikely to cover the damage.

4. Renters insurance provides liability coverage

Standard renters insurance policies also include liability coverage. This protects you if someone is injured in your home or if you (or another covered person) injure someone by mistake. Up to the policy maximum, it pays court verdicts and legal expenses.

Most policies include at least $100,000 in liability coverage, as well as a smaller amount for medical expenses. If necessary, you can request (and pay for) greater coverage limitations.

5. Protect your belongings in your absence

Renters coverage protects your personal belongings while you’re away. Your belongings are protected against theft and other covered losses wherever you go in the world.

For more information on what defines “other covered losses”, consult your policy or contact your insurance agent.

How does renter’s insurance work?

Renters insurance is affordable insurance coverage for people who live in a rented apartment.

It protects the tenant against the loss of personal effects, some types of liability and cases of events that have occurred on the property.

This type of insurance policy covers the personal belongings of the insured such as;

  • Furniture
  • Clothing
  • Litter
  • Appliances and kitchenware, etc.

What does renters insurance cover?

Most standard renters insurance policies cover your belongings in the event of power outages, water damage, fire, vandalism, theft, and other uncontrollable events.

Most, however, do not cover damage from floods, earthquakes, landslides, or nuclear disasters.

Here is a list of things your policy will cover:

Types of renters insurance coverage

There are three types of renters insurance coverage available:

  • loss of use
  • personal property
  • Personal responsibility
  • medical payments

loss of use

This type of renters insurance deals with situations that often arise after a disaster strikes your home.

For example, if you can’t live in your home after a disaster, this type of renters insurance coverage pays for you to live somewhere else during the repairs.

Take care of things like hotel bills, restaurant meals, and other costs incurred over the course of the disaster.

personal property

Personal property coverage covers your clothing, furniture, and other belongings. Your personal items are protected not only when you are at home, but also when you are away from home.

Your renters insurance coverage will cover you if your bike is stolen outside of a store, with a few exceptions.

To start, your deductible will apply.

Second, the amount of coverage you have outside your home may be limited (usually 10 percent of your total personal property limit).

personal liability insurance

Take, for example, someone being injured in your rental and suing you, the renters liability insurance policy is what covers you in these circumstances by paying for someone else’s bodily injury on and off your property.

Renters liability insurance also covers damages you and your family cause to others.

medical payments

This policy, like liability insurance, pays if someone is injured on your premises. What is the difference between the two?

Medical payments coverage pays regardless of who caused the damage, while liability insurance kicks in only if you’re found to be at fault.

Liability insurance typically has much higher limits.

A good example of medical payment is that if a visiting friend who normally comes to play soccer with his son at home sprains his ankle in the course of the activity, the medical payment coverage covers the X-ray and emergency treatment.

What does renters insurance not cover?

While you know what renters insurance covers, you should also be aware of the things renters insurance doesn’t cover.

Here are some things renters insurance doesn’t cover:

Flood Damage – Flood damage is generally not covered by most renters insurance policies. If your home is in jeopardy, you’ll have to pay for the repairs yourself or get separate flood insurance.

Earthquake damage: earthquakes will not be covered by the rental policy. However, you can purchase earthquake insurance separately and add it to your renters policy.

Infestations – Most renters insurance does not provide coverage for bed bugs, mice, rats, or other infestations. However, you may be able to get bed bug coverage with an Assurant renters policy depending on where you live.

If you have any valuable items like gold, high-end electronics, musical instruments, or a significant art collection, you may need to get floating insurance to cover these items.

Lastly, renters insurance policies do not protect against loss of items as a result of negligence.

How to file a renters insurance claim

If you need to file a renters insurance claim, here are some guides to remember to help you through the process. However, keep in mind that your claim process may differ depending on the extent of the damage.

Contact your insurance agent as soon as possible to report the claim.

Protect your items from further damage. Talk to your agent about any emergency repairs that may be needed.

Your agent will ask you questions about the damage and answer any questions you may have about the process.

Review your policy coverage and limits with your agent to understand what applies to your situation.

Document damaged items in writing and take photos or video of the damage before repair work begins if necessary.

How much renters insurance do I need?

The amount of renters insurance you need is determined by how many things you own, as well as the value of your assets. You will need additional insurance if you have a lot to lose.

Take inventory of your items before you buy renters insurance to determine how much personal property coverage you need.

There are several home inventory apps available to help you catalog your belongings. This will be helpful if you ever need to file a claim.

How much is renters insurance coverage?

When you bundle your auto and renters insurance plans, most insurance providers give you a discount. If your apartment has a security system, smoke detectors, or deadbolt locks, they may be able to lower your rate.

Consider raising your deductible if you’re looking for more ways to save money. This is the amount that will be deducted from a check from an insurance company.

If you have a $1,000 deductible and a $5,000 property damage claim, your insurance company will pay you $4,000. Your premium will be lower if you have a higher deductible.

When choosing a deductible, consider how much you can pay out of pocket in the event of a calamity. Please note that you will be responsible for the deductible each time you file a personal property claim.

Your rate will likely increase after each claim, so shop around and decide if you file one for an amount close to your deductible.

How much renters insurance do I need?

Before making a decision, consider all of your personal belongings. Be sure to purchase a renters insurance policy with enough coverage limits to cover all of your belongings.

To make sure you don’t forget anything, you may want to take an inventory. 

You can keep your list up to date as you purchase new products. Don’t forget to check your renters insurance coverage as well. 

Best Renters Insurance Companies of 2022

Don’t overlook the valuable protection tenants can give you if you rent out your home.

Based on price, coverage options, and discounts, these are the top renters insurance companies.

  • Friend
  • financial country
  • American Family
  • Lemonade
  • USAA
  • Erie
  • Progressive
  • Cachero
  • nationwide
  • Travellers

Renters Insurance FAQs

Question: Is renters insurance legally required?

No, sometimes it is required by the owners.

Question: What if I don’t have renters insurance?

If you’re lucky, you’ll save about $14 a month. But, without renters insurance, you’ll be in financial trouble if something bad happens.

Question: How much renters coverage do I need?

Many landlords require their tenants to have at least $100,000 in liability insurance. If your landlord suggests, talk to an insurance agent to determine how much coverage you need.

Question: How much does renters insurance coverage cost?

Although renters insurance typically costs around $14 per month, the average cost of renters insurance varies from state to state.

Conclusion

While moving can be a hassle in and of itself, don’t forget to make sure you have the coverage and protection you’ll need in the event of an emergency. 

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