What you need to know about Renters insurance
Many people who live in an apartment or rented house don’t have renters insurance. Experts estimate that about two-thirds of renters go without insurance. The reasons aren’t clear, because rental insurance is among the most affordable coverages available. Here are some things to know about rental insurance to help you make an educated decision on the product.
What is it?
Rental insurance is a type of property/casualty insurance that covers damage and loss to your possessions in a rented property. Most rental policies cover loss of use, meaning that if your rental property is rendered unlivable due to a disaster, the insurance will pay for you to live elsewhere. Most policies also provide personal liability protection, which covers you against things such as someone slipping in your apartment and getting injured.
Who is it for?
Rental insurance is for anyone who lives in a rented property, whether that’s a single-family home, townhome or apartment.
How does it work?
Insurance for renters works much like any other type of property insurance. If you sustain damage to your possessions due to a disaster such as wind or a fire, you must file a claim with your insurance company. The company determines that you have a valid claim, it will offer you a settlement based on your amount of loss and your coverage limits.
Different types of coverage
Renters insurance is pretty standard, with little variation between policies. The insurance operates much the same as homeowners insurance, covering your against things like fire and wind damage, and excluding things such as floods. Some policies offer riders that allow you to cover additional items that aren’t normally covered, such as a storage shed.
The No. 1 benefit of insurance for renters is the protection of personal property from disaster loss. Most landlords do not carry insurance to cover damage to their tenants’ possessions, so without rental insurance, you will not be covered if your possessions are damaged or destroyed. An additional benefit include personal liability coverage against lawsuits.