Renter’s Insurance isn’t just about your stuff, it insures you for so much more than that.
If you rent an apartment, house or condo, chances are your landlord has insurance coverage for the costs to repair or replace the building. But the landlord’s policy will not protect you for damage to your personal items or your liability exposures.
Renter’s Insurance is similar to Homeowners Insurance without insuring the home.
Like a traditional Homeowners insurance policy, a renter’s insurance policy has the same 3 key coverages that you’ll need in the event of a disaster or fire.
Insurance coverage for you personal items and possessions
Liability protection from lawsuits that may be brought against you.
Additional living expenses.
Let’s break each of them down just a bit to give you a better understanding of what they are and why you need them.
Insurance coverage for your personal items
Should a fire, theft, or natural disaster happen to your rented property that causes damage to you items, a renter’s insurance policy is designed to protect you. The question I often get is, “how much coverage do I need?”.
A detailed home inventory list is the best method of determining how much insurance you need. Once you determine how much stuff you have, now you know how much insurance you’ll need.
What types of things catastrophes are covered?
The coverage that is offered on most renter’s insurance policies are very broad in scope but they all have coverage limitation. Most policies will offer insurance coverage for Fire, Smoke, Lighting, Wind, Hail, Vandalism, Explosion and Malicious Mischief.
What types of catastrophes are not covered?
But like a traditional homeowners insurance policy, damaged caused by flood or earthquakes are not covered. A separate flood or earthquake policy would be needed for these two specific catastrophe’s.
High value items and collectibles, are they covered?
Things like jewelry, watches and furs and even guns, musical instruments and collectibles have limitations on a renter’s insurance policy. These items can be insured on a “floater” endorsement. Keep in mind, your renter’s policy is for your everyday type items and not your specialty type items.
Motorcycles, boats, campers, golf carts and boats, what about those items?
The renter’s policy does not offer coverage for these types of items. Keep in mind, a renters policy is for you everyday stuff, like; clothes, furniture, appliances, kids toys, rugs, pot and pans, TV’s and stereo’s.
Liability Insurance Protection is the big one.
Accidents happen and so do lawsuits. That’s why in my opinion liability insurance protection on a renter’s insurance policy is the most valuable coverage on the policy. A slip and fall or even a dog bite from you sweetest pet can become a large monetary claim against you by one of your guests. Most renter’s insurance policies have no-fault medical coverage that offers an added layer of protection to help offset medical bills to possibly shield you from a lawsuit.
But the biggest liability for a renter is due to damage that they may accidentally cause to the rented property. Sure the landlord probably has insurance for fire or water damage but what if you’re the one that accidentally caused the damage to the structure? This is where a big insurance word comes in to play, “subrogation“. Subrogation is when the landlord’s insurance policy pays to repair or replace the damage YOU caused and then the insurance company sends you the bill to pay them back for what they have paid for the repairs.
I’m sure that with this new word “subrogation” in your vocabulary, you’re thinking that this couldn’t happen to me. What if you left the stove on and walked outside for a moment? You left the bathtub running because the phone rang and you became distracted? Now you’re starting to see the likelihood of the magnitude of your liability. The good news, renters insurance is the key to protecting you from these financial pitfalls that could happen without warning.
Additional Living Expenses due to damage to the property.
The additional living expenses afforded on most renter’s insurance policies are there to help you pay for a temporary rental, hotel, meals and even laundry expenses. Your renter’s insurance policy will help to cover the expenses you’d incur because your rented property is damaged and unlivable due to a covered loss.
The cost is less than you might think – oh and don’t forget about the discounts.
Many insurance companies will offer discounts for “bundling” your car insurance and renter’s insurance. This approach is considered a multiple policy discount. The cost of a renter’s insurance policy is an excellent value for the coverage and peace of mind it provides.
What is the bottom line to the bottom line on renter’s insurance?
Renter’s Insurance is what a renter needs to insure their belongings, protect you from lawsuits and provide you money for living expenses if you’re forced to leave due to damage to your rented location.
Coverage will vary from company to company and from agent to agent. Be sure to go over the renter’s insurance proposal with your agent to make sure you understand what you’re being offered.
As always, me and my team at Tristar Insurance Services are here to help guide you through the renter’s insurance process.
Rodney Stewart, Agency Owner of Tristar Insurance Services