What Does Renters Insurance Cover? A Detailed Analysis

Get renters insurance for protection.

Renting has advantages: landlord covers building insurance and repairs, but you’re accountable for your belongings.

Landlord’s coverage excludes your items in cases like storms or theft.

What Is Renters Insurance?

Renters insurance covers your personal belongings in case of theft, fire and other disasters. It can also pay your legal expenses if someone sues you.

Renters insurance, aka tenants or HO-4 policy, is like homeowners insurance for non-owners.

Renters Insurance Coverage
What renters insurance cover: Photo source (Bing.com)

It costs about $148 yearly or $12 monthly on average, per NerdWallet.

It’s cheaper than homeowners insurance as it covers belongings, not the structure. Some landlords demand it before leasing.

What does renters insurance cover?

A standard renters policy includes four types of coverage.

Type of coverage

What it does

Personal property

Covers your clothing, furniture, electronics and other belongings.

Loss of use

Pays for hotel stays, restaurant meals or other expenses if you have to live elsewhere while your home undergoes covered repairs.

Liability

Pays out if you’re responsible for injuries to other people or damage to their property.

Medical payments

Covers injuries to other people in your home, regardless of fault.

Personal property

Most renters insurance reimburses you for the loss of items such as clothing, smartphones and other personal belongings because of these specific events:

  • Fire or lightning.

  • Windstorm or hail.

  • Theft.

  • Smoke.

  • Vandalism or malicious mischief.

  • Explosion.

  • Volcanic eruption.

  • A falling object.

  • The weight of ice, snow or sleet.

  • Riot or civil commotion.

  • Accidental discharge of water or steam from within certain household systems or appliances.

  • Sudden and accidental tearing apart, cracking, burning or bulging of certain household systems.

  • Freezing of certain household systems or appliances.

  • Sudden, accidental damage from artificially generated electric currents.

  • Damage caused by vehicles or aircraft.

Your belongings are protected both at home and outside.

Also read: Does Title Insurance Cover Property Line Dispute?

If your bike is stolen, your renters insurance covers you, subject to deductible and a potential 10% limit of your total personal property coverage.

Renters insurance
Renters insurance coverage: Photo courtesy (Forbes)

Loss of use, or additional living expenses

When your home is unlivable due to a disaster, renters insurance pays for alternative living arrangements during repairs, including expenses like hotels and meals, beyond your usual costs.

Liability insurance

Renters insurance safeguards your finances from lawsuits resulting from injuries in your rental.

It covers bodily harm, except car accidents, and accidental damage to others’ belongings.

It can even include dog bite incidents, though breed limitations apply.

The policy covers legal fees, awarded funds, and liability claims against you.

Medical payments

Similar to liability insurance, this coverage pays for injuries on your property.

However, medical payments coverage pays regardless of fault, while liability insurance requires you to be responsible.

Liability coverage often has higher limits.

Optional renters insurance coverage

In addition to the standard coverage listed above, you can usually pay a little extra to customize your policy with endorsements that add more coverage.

Here are a few of the most common.

Replacement cost coverage

A regular renters policy reimburses items at their current value, not new.

So, for example, an old sofa’s value might not cover a new one.

Replacement cost coverage ensures you get new item costs.

Scheduled personal property

Renters policies limit payouts for valuables like jewelry, electronics, and firearms, especially for theft.

To insure items above this limit, consider adding a scheduled personal property endorsement.

For example, if you inherit a valuable ring, your insurer might require a professional appraisal before adding coverage at an extra cost.

Here’s a list of items and their usual coverage limits. Check your policy or ask your agent for specifics.

Electronics.

Firearms.

Furs.

Items used for business purposes.

Jewelry and watches.

Money, gold and coins.

Silverware, goldware and pewterware.

Watercraft and trailers.

Water backup coverage

You may be able to add coverage for damage if your sink, toilet or other drain backs up, sending water gushing into your apartment.

Pet damage liability

If your pet tends to cause damage (like carpet stains or wall scratches), inquire about a pet damage endorsement from your insurer.

It covers cleanup and repairs, sparing your security deposit when you move.

Identity theft coverage

Certain insurers provide optional identity theft coverage, which covers costs like credit monitoring, legal fees, and document replacement.

Find out more about identity theft insurance.

What renters insurance doesn’t cover

Every insurance policy has exclusions, and renters insurance is no exception. Below are a few things renters insurance won’t pay for.

What renters insurance does cover
What the insurance policy doesn’t cover/: Photo source (Reddit.com)
Flood damage

Typically, renters insurance excludes flood damage like heavy rain or overflowing water. You’d need separate flood insurance, unless you’re with USAA, which covers floods for military and veteran renters.

Earthquake damage

The majority of renters insurance policies won’t cover earthquakes. (Again, USAA is an exception.) You can buy earthquake insurance separately or as an add-on to your renters policy.

Infestations

Typically, renters insurance excludes pests like bedbugs and mice.

Assurant renters policy might cover bedbugs based on your location.

Jetty, available at select properties, includes $300 bedbug coverage in basic plans.

EPremium and eRenterPlan offer bedbug remediation coverage in specific rental communities.

Your roommate’s belongings

Most renters insurance won’t cover your roommate’s stuff unless the two of you share a policy, which not all states or insurance companies allow.

In most cases, it’s best if you each get your own renters policy.

How much renters insurance do I need?

Your renters insurance amount is based on your possessions’ value and your assets. More to lose, more coverage needed.

Prioritize a home inventory before purchasing insurance, apps can help. Use our calculator for a quick estimate.

 

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