Insurance Facts All Renters Should Know

Posted on: 28 June 2023

There is freedom in renting because you do not have to worry about all the risks of property ownership since you are not an owner. However, you do not want to take this carefree attitude too far. The renter must protect their belongings.

Limits of Owners Insurance

Some renters think that as long as the building owner has coverage, they have coverage too. However, there are limits to owners' insurance in terms of renter protection. Owners' insurance is only intended for the structure and fixtures in their unit. Kitchen appliances and flooring are just a couple of examples. Your furniture, clothing, and other household goods would not be covered in a loss. 

Liability Protection

Another important distinction is in the area of liability. When you rent, you are typically responsible for any damage caused to the property beyond normal wear and tear. Consider a scenario where a tenant's dog causes significant damage to the flooring. Without liability coverage, the owner would be entirely financially responsible for the repair cost. Renters' insurance policies include liability protection to help tenants cover damage in the event of a loss.  

Personal vs. Included Insurance

Some landlords will include renters' insurance in the tenant's monthly rent for a very small fee. Often, these policies are designed to serve the owner more than they are the tenant. For instance, the household goods coverage limit might be very low, such as $5,000, but the liability coverage will be high, such as $100,000. In this instance, in the event of a significant loss, the renter would have very little coverage to replace their household goods. However, the building would be well protected with such a high liability threshold. Research your coverage options with an insurance agent.

Unique Coverage Options

It is also worth noting that renters' insurance policies come with various coverage options, including loss of use coverage and even power loss damages. With the loss of use coverage, if the unit is unlivable for a period due to damage, this coverage will provide the tenant with temporary living assistance, including lodging and food costs. Power loss coverage will provide a lump-sum payment to cover the cost of any refrigerated or frozen food destroyed due to a loss of power. 

Make sure you do not leave yourself unprotected. In the event of a loss in your rental unit, you want to ensure you are fully covered. Partner with an insurance agency to accomplish this goal. Contact a company like Lovelace Family Insurance for more information.