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When you rent an apartment, unit or home, your landlord is responsible for insuring the building, taking care of necessary structural repairs and covering any injuries that directly result from issues related to the building itself. However, renters play a role in insuring their home with their own policy as well. Some landlords actually require renters to have their own policy in order to complement the landlord’s insurance in case any disaster occurs, while others may leave this decision up to the renter.
Keep reading if you’re wondering whether or not renters insurance is worth it. Even if your landlord requires it, there are some things to consider when choosing a provider. Additionally, it’s always important to get quotes from a few different companies to help guide your decision and find a policy that makes the most sense for you.
What is renters insurance?
Renters insurance is similar to homeowners insurance, but without the dwelling or structural coverage, since that is included in the landlord’s policy. It’s designed to protect the renter from burdensome out-of-pocket expenses when an unexpected event occurs, like a fire or robbery.
The covered expenses on renters insurance policies typically include the replacement of personal property, loss of use when displaced from your home and daily routine, and liability when you may be responsible for someone’s injury that happened in your home. When an unexpected covered event occurs, you file a claim with your provider and start receiving benefits according to the agreed upon amounts.
Is renters insurance worth it?
Renters insurance may be necessary if your landlord requires it upon move-in. Landlords often make having your own policy mandatory because they don’t want to be held responsible if someone gets injured in their tenant’s home. However, the tenant benefits from renters insurance policies as well by having their items protected from an event that may not fall under the landlord’s insurance.
Even if your landlord doesn’t require you to have your own policy, it can be worth it for your peace of mind and for protecting yourself from the financial burden of unexpected losses in the future. The good news is that there are some reasonably priced policies offered by trusted providers if you don’t want to commit too much money at first. Additionally, you may be able to save on your rate if you purchase a bundled policy from your auto insurance provider. You can use this online tool to get a free quote and start comparing companies in your area.
What does renters insurance cover?
There are three main categories that are covered by renters insurance policies from certain events. Any loss or expense under these categories occurring from an included event will be paid up to a certain amount. If you want additional options for coverage, most providers offer add-ons for your policy called endorsements that are great for renters looking for extra peace of mind.
Listed below are the basic categories included in most standard policies:
Loss of Use: This kind of coverage is paid out if you have any extra expenses to pay for after a covered event. For example, if you’re displaced from your home and have to pay for a hotel room and extra meals, your renters insurance would cover those costs.
Personal Property: Personal property coverage is the most important category for many people, since it gives renters peace of mind that their belongings will be replaced after a covered unexpected incident. There are typically two options when selecting your policy: actual cash value (ACV) and replacement cash value (RCV). ACV policies are typically cheaper since they only cover the depreciated value amount of your personal items.
Liability: Liability coverage pays for expenses that could arise if you’re held responsible for someone else’s injury that occurred in your home. Liability insurance will take care of both medical expenses and legal fees if necessary. Some policies will cover medical payments for injuries that occur in your home, even if you’re not at fault.
Here are some examples of events that are covered, and not covered, by typical renters insurance standard policies:
|Falling objects||Damage from pets|
|Theft||Damage from pests|
|Lightning and Electrical damage||Sinkholes|
|Snow, sleet and ice||Terrorism|