The Benefits Of Renter's Insurance
The American dream is all about owning a home, but many individuals are renters whether they like it or not. Some rent because they move around for work, and a good example of someone who might rent is a member of the military and their family. Others rent while they are building their dream home, after moving into a new city or town while they’re on the hunt for a home to buy, and if they’re in college and not looking to purchase a home right away. Renting is not uncommon, but many renters still wonder if renter’s insurance is worth the cost. Here’s what renters need to know before they decide either way on a rental insurance policy.
What Is Renter's Insurance?
The question many individuals have if they’ve never rented before is what is renter's insurance and how does it work? Renter’s insurance is a simple concept: it’s an insurance policy designed to protect renters and their belongings. Sometimes called tenant’s insurance, it’s an additional insurance policy to protect renters when the landlord’s insurance policy does not, as most landlords don’t cover the cost of replacing the renter’s belongings if a disaster occurs. The typical landlord carries insurance on their home or building, but they don’t pay to protect the cost of replacing everything inside the home that doesn’t belong to them. Renter’s insurance is a policy that helps renters protect and replace their belongings if a fire, theft, or other natural disaster occurs. Of course, not all policies are created equal, and it helps for renters to speak to their insurance agent to determine what their policy covers and what additions they might need.
Continue reading to learn about personal property when it comes to renter's insurance.
Personal Property
Personal property is anything belonging to a renter in the home or apartment they live in. It’s tangible property such as their clothing, furniture, and electronics. A renter’s insurance policy covers these belongings up to a certain limit. All renters are required to set that limit within their policy when choosing a policy. For example, a renter with a large rental home and many expensive items might choose a much larger and much more valuable policy than a young couple just starting out with secondhand furniture. This coverage allows the renter to collect payment for the damaged property inside the home if an unexpected event occurs, up to the stated limit. If the value of the items in the home exceeds what the policy covers, the renter will not receive money to replace the items or repair the extra damage.
Continue to reveal how loss of use coverage works in renter's insurance.
Loss of Use
Loss of use coverage is more commonly referred to as additional living expenses coverage. The home or apartment renters are renting is their home even if they do not own it. It’s the place they go at night, the place that makes them feel safe and secure. If something happens and that shelter is no longer livable, renters would be homeless. Additional living expenses coverage can help protect renters from a situation such as this, as it can help pay the cost of their hotel bills while they’re searching for a new place to rent or waiting for repairs to their current rental.
Keep going for how liability coverage comes into play in renter's insurance.
Liability
Liability coverage is an important piece of an insurance policy to have, and every renter should include it in their rental policy. Renters are personally responsible for certain things, but this doesn’t mean they can afford to pay for them. For example, if the renter invites a guest into their home and the guest gets hurt after falling down the stairs, they could choose to sue the renter for damages. The renter could be found liable for the medical bills and injuries the guest suffered and is then responsible for paying those costs. Liability coverage protects the renter from being personally liable for the damages that occur to guests and even to the building itself. It’s one of the most important policies, as it protects against personal injury lawsuits, which can become quite costly.
Continue reading to reveal what renter's insurance does not cover.
What Isn't Covered
There’s a lot renter's insurance might not protect, and it’s important renters know this information as it applies to their policies. A typical renter’s insurance policy does not include coverage for natural disasters such as flooding, earthquakes, and even hurricanes. If a renter wants coverage for their personal property because they live in a place that sees a lot of natural disasters, they must have an additional policy to cover this type of damage. Furthermore, pest damage, terrorism, and nuclear war are not covered under a traditional rental insurance policy either. If a renter has items of high value such as family heirlooms in the form of artwork or jewels, they must be protected with separate insurance policies. No policy will cover anything that costs more than the standard amount listed in a renter's insurance policy. For example, a policy might protect jewelry up to two thousand dollars, but anything more valuable is not protected. Finally, renter’s insurance only covers the items the renter owns, and any roommates must have their own policy if they want their belongings covered.