When you rent the home you live in, you have some clear advantages over the person who owns their own home. Out Fast Management says, as a renter, you don’t need to think about how to maintain the structures and systems of the building. The owner takes care of everything. As long as you don’t do anything to damage the home, your landlord will not ask you to pay for repairs.
You are also free to live anywhere you want. Being a renter means you can live in an upscale part of town, even if you can’t afford to buy a house in that location. Renting also affords you the freedom to move if you think there are better opportunities elsewhere. As a renter, you are not compelled to put down roots in any location just because of your investment in that place.
The other side of renting
Life as a renter also has its downsides and it’s not all sunshine and roses. One of the cons of renting is that your belongings inside the rented place do not have the same protection as the landlord’s property.
If that home or its content is destroyed or damaged by a fire, burglary, or any unfortunate event, the landlord’s insurance will not protect you.
Many renters don’t know this. They reason that since the owner of the rented home has landlord’s insurance, it must mean that their belongings are also insured. This is not true. In the event of a catastrophe, the owner’s insurance company will make a clear distinction between what belongs to the landlord and what belongs to you, as a tenant.
Landlord’s insurance covers only the building and the owner’s belongings inside it. It does not extend coverage to your belongings in the home. You are without insurance when you rely on your landlord’s insurance to protect you and your property. This is the unfortunate reality of life as a renter. But what can you do about this problem?
Renter’s insurance and why you need it
Renters occupy a unique place when it comes to insurance. Although they do not own the home they live in, they have their belongings inside that home. Renters face the same risks as landlords. Yet they cannot buy landlords or homeowner’s insurance because these two types of insurance policies require you to own the home being insured.
If as a renter, you cannot buy landlord’s insurance but are also not covered by your landlord’s insurance policy, is that not a problem? Does that mean renters are doomed to live without some form of property insurance? The answer is no and that’s because there is another type of insurance policy that caters to the unique needs of people living in a rented home.
Renter’s insurance is an insurance policy designed for people who rent their homes. It offers tenants the kind of protection landlords have without the higher premiums that landlords pay. Renters insurance ensures that in the event of ruinous events at your rented home, you are not left without insurance coverage. What are the covered perils in renter’s insurance?
What to expect from renter’s insurance
Renter’s insurance covers almost all harmful events renters are exposed to. From the moment you move in renters insurance can cover damage from specific perils during a move. These include theft of your belongings, as well as damage from vandalism and fire. However, renters insurance may not cover damages caused by movers, as that is the moving company’s responsibility.
In general some of the covered perils of renters insurance are fire, lightning, hail, windstorms, smoke, vandalism, riots, theft, explosion, damage by ice, sleet or snow, damage by vehicles or falling objects, and damage caused by aircraft. In practical terms, you can expect the following from your renter’s insurance policy.
Personal property damage
If your belongings inside the home are damaged or lost as a result of fire, theft, or other event, renter’s insurance will compensate you for the loss. Depending on the type of renter’s insurance you bought, the policy will pay either the replacement cost (RCV) or the actual value (ACV) of the items.
If a friend, worker, delivery guy, or random person is injured in your home and you are found liable for their injuries, a standard renter’s insurance will pay up to $100,000 in liability coverage. The policy will also pay your legal expenses (up to a limit defined by the policy) and the medical bills of the injured party.
Additional living expenses
If for any reason your rented home becomes uninhabitable (such as when the home is damaged and undergoing repairs), renter’s insurance will cover the cost of temporary housing. Renters often make the mistake of thinking their landlord will do this. That assumption is wrong but with renter’s insurance, you are covered.
Coverage for items taken from your vehicle
If you leave your belongings – like a laptop, for instance – inside your car and it is stolen, the renter’s insurance will compensate you for the loss.
Property insurance while traveling
Renter’s insurance will cover the cost of lost or stolen items if the items are lost or stolen while traveling in a country recognized by the policy.