What Does Renter’s Insurance Cover?

What Renters Insurance Covers
Not all renters policies are the same. But in general, renters insurance can cover:

Personal Property
Renters coverage can help you replace your belongings after a covered incident in your condo, apartment or rental home, for events such as a fire or a burglary. In the US, an average renter owns approximately $20,000 in personal property.

Personal Property Tip – Create A Home Inventory List
Take your camera or mobile device and take pictures (or video) of every room in your home from all angles. Be sure to open drawers, closets, etc., to be sure you have a visual list of everything you have. You might be surprised at how many tools, shoes or books you really have. Also, use an automated calendar reminder to cause you to take pictures each and every year. A good time is at the first of the year.

What People Are Covered Under One Renter’s Insurance Policy?
The covered individuals will depend on the specifics of your renters’ policy. In general, when you get purchase renter’s insurance, you’ll have the option of adding another person to your policy. Note that if you have a boyfriend/girlfriend move in and that they are not named, they are not covered. It is recommended that, unless you’re married or related to your roommate, each person obtain individual coverage.

Does Rental Insurance Cover Items In My Car Or When I Travel?
Check with your specific policy, but in many cases, renters are covered for their belongings anywhere in the world — whether they’re stolen from the trunk of their rental car or out of your backpack while camping. A theft extension option provides extended protection for your personal belongings stored away from your home in or on any motor vehicle, trailer or watercraft.

Personal Liability Coverage
If you’re sued because someone was injured while visiting you (or someone covered under your policy) in your covered property, or if you accidentally injured someone, your renter’s insurance can provide liability coverage for your incurred legal costs. Please note that the limits of personal liability coverage will vary according to your carrier and the limits of your plan.

Medical Payments Coverage
Your renter’s insurance policy can also help provide payments for medical costs up to the predefined limit if a guest or visitor is injured on your covered property. Please note that most insurance policies do not cover injuries to you or other household residents.

Property Damage At Other Locations
Your rental insurance coverage will follow you wherever you go, therefore if you inadvertently break or damage someone else’s property, your policy can help pay to replace or repair the damaged item.

Additional Living Expenses
If you can’t stay at your place because a covered incident, your rental insurance can help pay for a place to stay and temporary housing. Loss-of-use coverage, otherwise known as relocation expenses or additional living expenses, could help cover living costs up to a certain limit.

Replacement Cost Coverage
Many rental insurance policies allow you to elect coverage for replacement cost coverage (RCC) instead of actual cash value (ACV) for your personal property coverage. When you select RCC coverage, your damaged or stolen possessions will be replaced at the current market value. ACV, on the other hand, will take into consideration wear and tear from prolonged use. Unlike ACV, RCC doesn’t take depreciation into account.

Replacement Cost Coverage Tip
Keep receipts of all your purchases. The simplest way is to simply take a picture or scan your receipts. At a minimum, use a credit card whenever you can, so you have a verified history of your expenditures.

Sewer Or Drain Backup Coverage
As the saying goes, ‘sh*t happens.’ A sewer backup is a more common occurrence that most people realize. Your sewer or drain backup coverage will protect you against loss of or damage to your property, goods, and valuables.

What About Flood Damage?
Renters insurance generally does not cover flood damage.

Earthquake Coverage
Earthquake coverage varies by state and policy, but it can be available with renters insurance. Your insurer can advise you on whether you can add it to your policy — especially if you reside in an at-risk area.

Insurance Riders
You may elect to add an insurance rider if you own additional valuable assets such as a rare coin collection, expensive jewelry, rare books, or other valuables. Your rental insurance policy will cover your prized possessions up to the limits specified in your plan. Firearm coverage may help pay for the physical loss of firearms and accessories. Certain exclusions may apply so be sure to check the specifics of your coverage contract.

Disasters And Incidents Covered By Your Policy
Disasters occur in many forms, and generally are unanticipated. But that is why you have coverage. With renters insurance, you can mitigate your out-of-pocket expenses brought on by:

  • Fire or lightning
  • Windstorm or hail
  • Explosions
  • Smoke
  • Vandalism
  • Theft
  • Burglary
  • Falling objects
  • Weight of ice, snow, or sleet
  • Freezing
  • Volcanic eruption

Credit Card Coverage For Renters
Credit card coverage pays up to your selected limit for unauthorized transactions on your credit cards and bank debit/ATM card. This means your renter’s insurance coverage will also applt to any forged checks and counterfeit money.

What Happens To My Renters Insurance Policy If I Move?
If you move, your policy can generally move with you. You would contact your insurance company or agent and have your insurer update your policy. Note that if you move to a new state, be sure that your insurer is permitted to write a policy in your new state.

What Are The Payment Options For A Renter’s Insurance Policy?
Most insurance companies will allow you to pay your premium all at once or in installments, typically monthly or quarterly. Note that if you do decide to pay in one lump sum, you can avoid installment fees.

Deductible Considerations

Before renters insurance starts to help pay for a covered loss, most plans cal for you to pay a deductible. The amount of your deductible is often tied to your premium (the amount you pay your insurance company to keep your policy in force). There is an inverse relationship between deductibles and rental insurance premiums – the lower your premium, the more your deductible may be for each covered loss.

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