Renters Insurance is a type of property insurance that protects you against losses to your personal possessions, property, and assets within your rented property. It also covers you from claims or lawsuits filed against you regarding a third-party bodily injury or property damage at your rented property. Renters Insurance works similar to Homeowners Insurance, but it’s for people who rent or lease properties, such as an apartment or house. It protects you and your belongings if anything unexpected happens at your rented property. A Landlord Insurance policy is not an alternative to Renters Insurance as it covers only the building, not your personal possessions. You must get a Renters Insurance policy if you rent an apartment, house, or condo.
What Does Renters Insurance Cover?
Renters Insurance provides three main types of coverages: personal belongings coverage, liability coverage, dwelling expenses coverage.
1. Personal Belongings Coverage
As the name implies, Personal Belongings Coverage covers the contents of your rented dwelling against any damage to them caused by covered perils, including:
- Fire
- Theft
- Vandalism
- Plumbing issues
- Electrical Malfunctioning
- Smoke Damage
- Windstorm
- Water Damage
This coverage protects you against any losses to your personal property and possessions within your rented dwelling. Some common belongings and items that Renters Insurance covers include:
- Electronics and Appliances
- Furniture
- Clothing
If you have expensive jewelry items like engagement rings or diamond bracelets, you may need special coverage to cover these valuable items.
2. Liability Coverage
Liability Coverage protects you in certain covered events when you get sued by a third party for an injury or property damage incurred at your rented home by you or other people. This coverage also helps you pay for the damage you, your family, or your pet cause to others. Your liability coverage also reimburses you for legal expenses, such as lawyer or court fees, to defend your case in court.
3. Dwelling Expenses Coverage
Also called Additional Living Expenses Coverage, dwelling coverage reimburses for your additional living expenses if your rented property becomes uninhabitable due to a covered peril and you’ve to arrange temporary housing at a restaurant or hotel. It helps you pay hotel bills, restaurant meals, and temporary rentals until your rented property is restored to be inhabitable again.
What is not covered by Renters Insurance
Renters Insurance doesn’t cover your rented property against any damage caused by:
- Backup of Sewage into Your Residence
- Earthquakes
- Floods
- Acts of Gods
If you have valuable items at your rented property, such as jewelry, high-end electronics equipment, or musical instruments, you need to add floater Insurance as a rider to your Renters Insurance policy. You must also keep in mind that any damage to your possessions or personal property due to your own negligence or intentional acts is not covered by your Renters Insurance.
How Much Does Renters Insurance Cost?
The Average cost of renters insurance is $13 per month and $159 a year. However, the actual cost of renters insurance depends on a variety of factors, such as:
- The amount of personal possessional and their value
- Level of Coverage
- Geographical Area
- Insurance Provider