Renting is an appealing lifestyle for many Americans today. As opposed to owning a home, renting provides the comfort that home life has to offer without the weight of a mortgage payment or long-term commitment to the property.
Renting a property comes with the important task of acquiring renter’s insurance. Most renters are required to obtain insurance by their leasing office or landlord but are not educated about what the policy actually covers. The following is everything you need to know about renter’s insurance.
What is Renter’s Insurance?
Renter’s insurance is essentially the renter’s equivalent of homeowner’s insurance. Your policy protects your property from harm, caused by theft, fire, water damage, and more. It also protects you, the renter, from potential liability claims.
Liability claims may arise in the event that someone is injured on your property and chooses to take legal action against you. Your policy will cover the costs of necessary legal defense if you are sued by an injured person or the landlord, as well as medical bills if someone is hospitalized due to an injury on your property.
Renter’s insurance applies if someone is injured due to structural failure or otherwise. Additionally, if the property you are renting is damaged and you are required to move out while repairs are made, your policy will cover the costs of alternate housing.
What Events Does Renter’s Insurance Cover?
The renter’s policy will cover the cost of your belongings in the case of theft, or if they are damaged due to an “event.” Most policies cover damages caused by 15 specific events: lightning/fire, hail, smoke, vandalism, explosion, volcanic eruption, falling objects, ice/snow, riots, accidental water damage from within the home, sudden tearing of the home structure, freezing occurring within the home, sudden damage from electric currents, damage caused by aircrafts, and damage caused by vehicles.
Your property will be covered even if you are outside the home at the time of the event. Additionally, renter’s insurance covers a portion of your belongings even if it they are with you, and not inside the structure. For example, if you are out shopping and your smartphone is stolen, your renter’s insurance will cover a fraction of the cost of your phone replacement.
What Events Does Renter’s Insurance Not Cover?
Outside of the 15 main events (+ theft), your renter’s insurance policy will not cover much else. Depending on where you live, there may be some variation in your policy.
In general, however, the following are not covered by renter’s insurance: the structure itself, which is covered by your landlord, flooding, earthquakes, infestations of termites or mice, or a roommate’s personal property.
These events are often insured through separate individual policies. If you live in a region prone to flooding or earthquakes, it is best to reach out to your insurance agent to discuss potential coverage options. If you are unsure of what your policy does or does not cover, contact your insurance company for guidance.
How Much Coverage Should You Get?
Your renter’s insurance coverage is directly related to the combined worth of your belongings. When applying for renter’s insurance, it is wise to compile a list of your belongings and their estimated worth. This is especially important for any high-value items you may have on the property. Without doing this, it is easy to under-value the worth of your belongings, and they may not be fully covered in the event of a disaster.
Additionally, submitting a comprehensive list of your belongings will protect you if a claim needs to be filed in the future. By doing this, you will prove the value of your possessions and be much more likely to be reimbursed if they are stolen or destroyed.
Looking for Coverage?
Are you a current renter or looking to rent in the near future? We would love to discuss renter’s insurance with you. At GWK Insurance, our agents are prepared to walk you through the renter’s insurance process and/or help you file a claim, if necessary. Contact us today to discuss your policy options and get a free quote.