When you rent an apartment, house, or condo, you still need insurance. Your landlord will insure their building, but you probably want to have protection for your stuff as well as liability protection in case you get sued. Renter’s insurance is what you need.
What Does Renter’s Insurance Cover?
Renter’s insurance usually has two main coverages.
- Personal property coverage in case your belongings are damaged by fire, wind, or water, or you get burglarized.
- Liability protection that covers you for things like someone getting hurt inside of your apartment or your dog biting someone.
Sometimes, you might need to add separate water backup or damage coverage for things like your washing machine leaking or your waterbed bursting. If you need protection for earthquakes or flooding, those are usually not included in a standard renter’s insurance policy, and you need to get them separately.
What’s the Difference Between Renter’s Insurance and Homeowner’s Insurance?
Renter’s insurance and homeowner’s insurance policies are nearly identical. The main difference is that renter’s insurance doesn’t cover the building since you don’t own it, and the landlord buys their own coverage for that. The liability limits on a renter’s insurance policy can also sometimes be lower, although you have the option to raise them or add an umbrella insurance policy.
What is Additional Living Expenses Coverage?
Additional living expenses coverage is included in some renter’s insurance policies, and you may also be able to select it as optional coverage. It pays for extra lodging and meal expenses if a covered disaster causes your apartment to become unlivable. Even though you can usually get out of your lease in these situations, it can often take at least a few weeks to find a new place to move to.
Do You Have to Buy Renter’s Insurance?
Many landlords require you to maintain renter’s insurance coverage as part of your lease agreement. This helps to protect all tenants by helping to ensure that they can be reimbursed if another tenant negligently causes them harm or property damage.
Your landlord may ask for proof of coverage before allowing you to sign your lease or giving you your keys. Some landlords have deals with specific renter’s insurance companies, but you may still be able to pick your own.
Does Renter’s Insurance Have a Deductible?
Like other insurance, renter’s insurance usually has several deductible options ranging from $0 to $1,000 or more. If you choose a higher deductible, your premiums usually go down, but you’d have to pay the higher deductible in the event of a claim. Some policies may have separate deductibles for things like water damage, hurricanes, or specific types of property.
How Much Does Renter’s Insurance Reimburse You for Your Property?
Many insurance policies only reimburse you for the current value of your property. If you lose your furniture in a fire, you might only receive pennies on the dollar for what you paid for it. You might also not have the savings to buy all new furniture to replace it.
Renter’s insurance often has an option to select new replacement value in case of property damage or loss. If you select that option, you receive what it takes to go to the store and buy new.
How Much Renter’s Insurance Do You Need?
Choosing your property coverage limits is simple. Add up the value of everything you own and get that much coverage. If you buy new stuff that’s worth more, increase your limits.
For liability protection, consider having a high enough limit to at least cover all of your assets. You may also wish to carry a higher limit to protect against your future wages being garnished from a court judgment.
What About High-Value Items?
Your renter’s insurance may not fully cover jewelry, electronics, collectibles, and other high-value items even if your total property coverage limit is worth more than their value. Some policies exclude these items, and others impose per-item limits that are lower than what they may be worth. You’d need to add separate coverage for these items either through your renter’s insurance company or another provider.
Does Renter’s Insurance Cover Your Security Deposit?
Renter’s insurance generally doesn’t cover your security deposit. If you cause damage to your apartment, you generally have to pay for it on your own.
There are some insurance-like programs where you can pay a smaller nonrefundable deposit to a third-party company when you move in and not have to put down a full security deposit you’d have to worry about getting back. These are separate from or in addition to your renter’s insurance, though.
What Discounts Can You Get on Renter’s Insurance?
Each renter’s insurance company has different discounts available. Here are some of the most common.
- Safety features such as burglar alarms, smoke detectors, fire sprinklers, and deadbolt locks.
- Bundling with car insurance or other insurance.
- Good credit.
- Customer loyalty.
Remember that even if you have a discount, another insurance company may offer a lower price to begin with, so shop on total price, not discounts.
Talk to Your Insurance Agent
Renter’s insurance is inexpensive, but that doesn’t mean you don’t want the best rate. Plus, you might be able to save even more on all of your insurance by finding an insurance company with a bundle discount.
Contact innovante insurance, and we can tell you everything you need to know about renter’s insurance and get you multiple quotes from different companies.