Disclaimer: None of the content in this article constitutes legal advice. For the best information on if renter’s insurance is right for you, contact BestTexasInsuranceQuotes.com to have an agent contact different companies and find property renters insurance that is right for you.
Renters insurance is not required by law in the United States, not in any state. Some people believe it might be because other types of insurance like auto insurance or health insurance are required by law in some states. The same does not apply for renters insurance.
However, some landlords or leasing agencies do require renters to have property renters insurance before entering into a contractual agreement with them. Landlords might do this for a variety of reasons – namely, to reduce their liability. You having insurance makes them more safe – but it also keeps your property safe, too. Odds are, if you do have rental insurance on some or all of your personal property within the rental property, it’s significantly less likely that in the unfortunate circumstance of an accident where damage is caused to your property that you’d seek help from your landlord.
Your landlord’s property insurance does not cover your personal belongings. Many make the mistake of assuming that since their landlord is insuring their property that the renter is also protected under various circumstances. Which can certainly be true, but it virtually never applies to the renter’s own personal property. If you are renting a space of any kind and intend to fill it with belongings or property that are valuable to you, then renters insurance does seem like a necessity.
For those contemplating whether or not renter’s insurance is right for them and their specific situation, they should assume that their landlord’s insurance doesn’t cover their personal property. You can always ask, but most often, the answer is probably that it doesn’t. Landlord insurance protects landlords. Renter’s insurance protects renters.
Renter’s insurance, as we’ll learn, doesn’t cover everything. While your personal property will be protected under a renter’s insurance policy through many scenarios, some people opt to add an additional personal umbrella policy to their insurance portfolio to extend their coverage. So while purchasing an umbrella property won’t outright cover your personal property in the same way renters insurance will, it can protect you from things that your landlords insurance policy or your renters insurance policy cannot.
A personal umbrella policy typically protects renters and others from a long list of scenarios, including providing mitigation of costs for: either your or a third party’s medical bills or expenses for treatment for injuries that occur at the property; or your personal legal defense costs across a variety of scenarios. Personal umbrella policies do not cover your personal property, and protect you against liability in potentially more burdensome financial or personal harm – which makes them more expensive as a result to buy in to. If you’re looking to strictly protect your property, a personal umbrella policy is not necessary.
If your landlord does not require property renters insurance, of course, you could always risk it and not purchase coverage. The odds of something bad happening are fortunately pretty slim, and many renters forgo picking up a property renters insurance policy – only about 37% of renters presently utilize renters insurance policies. Those that do, however, understand that accidents of all kinds are unpredictable.
There’s no way to accurately predict whether or not you’ll be able to dodge accidents or unfortunate circumstances (don’t we wish there was!). With a property renters insurance policy – most of which are affordable and modifiable (as we’ll get to later on) – you’ll be able to soften the blow of most unfortunate circumstances. Property renters insurance can help repair or even replace a wide range of personal property across a wide range of scenarios,
There are generally sixteen primary categories of events that property rental insurance covers. These events include: fire and lightning; windstorms and hail; explosions; theft; riots; damage by aircraft; damage by someone else’s vehicle; smoke damage; vandalism; volcanic eruption (really); falling objects; damage from excess weight of snow, ice, and sleet on property structure; damage from steam-heating/water-heating appliances; leakage or overflow of water or steam; freezing of plumbing, heating, air conditioning; or short-circuit damage caused by electrical appliances. Flood insurance must be purchased under a separate policy. Got all that?
What this means in short is that property renters insurance not only covers virtually all of your personal property that you’d be interested in protecting, it also protects that personal property across nearly every reasonable scenario you could imagine.
What renters are liable for could be described in a short list, but it’s helpful to imagine a scenario where some of these risks come to life. Let’s say you have a friend helping you out carrying a sofa up three flights of stairs into your third floor apartment. You finally get to the door of your apartment, soaked in sweat and exhausted, and you set the couch down for a moment to unlock the door. You’re shocked at how hard it was to get the couch that looked a lot lighter online to this point, and are grateful for the help of a friend.
Once you get into the apartment, in the home stretch, you underestimate the turn radius of the couch in the small hallway, and ram a hole through the wall. Fazed but not yet finished with the move, you and your friends’ amateur moving service persists. Though the couch might just have to stay in the hallway at this point – because as soon as your friend goes to pick the couch back up, they throw their back out. They let out a scream, and then, out of nowhere and startled by the noise, your dog bounds over from the bedroom and sinks its teeth into your friend. What a day!
Though this example was intentionally ridiculous, you, the renter, are stuck in a tight spot at the end of your efforts to furnish your apartment. The hole in the wall here without renter’s insurance is an easy fix (a little spackle and paint will do the trick), and likely isn’t going to bankrupt you. However, what if your friend – who was nice enough to help you move – believes you’re at fault for their thrown out back? What if their injuries from the dog bite necessitate stitches and a hospital visit?
Renters liability insurance protects you from damages to other people, like your friend, and to damages to their property that you’re legally responsible for. After a scenario such as the one above, when you’re found liable in a claim, the liability portion of renters insurance can cover legal, medical, and repair bills. In an instance such as the one outlined, where without renters insurance you as the renter could be potentially saddled with who knows how much debt from legal and medical fees, renters insurance helps protect you from suffering unnecessarily.
Think of anything you own. A television, a video game console, the dvds or games – all covered. Your toaster, your laptop, your cellphone, your bed and bedframe and any furniture, your jewelry – you got it; also covered. Essentially most everything you own that could conceivably fit inside your rental space is covered under property renters insurance.
This coverage also extends to items that you own but exist outside of the actual physical property – which could include a bicycle, a doghouse, a garden gnome – so on and so forth. It’s important that to keep in mind that most things you can identify as actual physical property are going to be covered under property renters insurance. Remember, regular wear and tear and misuse is not covered. Damage must be as a result of a covered incident. So, if you drop your television and it breaks, that would not be a covered incident.
Property renters insurance will cover your personal property anywhere in the world – whether you’re on a boat, in a foreign country, or the supermarket. This means that if you’re on vacation a thousand miles from home and your laptop is stolen, property renters insurance can help out the same way it would if it happened at your rental property. Property renters insurance will be applicable, then, for personal property held in a storage unit as well. Although limited, another coverage to note is credit card theft and check forgery. As with all insurance policy rules, there are important caveats that you should be aware of.
The full value of your personal property, if damaged while away from the rental premises, will not be covered when off premises. And if that property is rented out to others – let’s say you’re renting out a laptop for example, or a bicycle – it won’t be covered at any rate. Property in a rental under construction isn’t covered, and your property in transit is most likely to only receive coverage if the rental is uninhabitable for some reason, or if your property is in transit before your rental insurance goes into place.
Exactly how personal property is covered is a bit different from plan to plan, and additional coverage is available through both internal policy modifications and external add-on coverage plans. This is an essential part of getting renter’s insurance – knowing what personal property you want covered under a potential plan, and communicating with a professional who can ensure that you’re getting the coverage you desire.
Sometimes referred to as loss of use coverage, this portion or rental insurance only kicks in once renters have to move away from their rental residence and into another temporary living space. Let’s say it’s the middle of winter and the snow caking on the roof your third floor apartment breaks through the ceiling due to the significant weight, and your apartment is suddenly uninhabitable. Renters insurance’s additional living expenses, in this instance, would kick in and cover your cost of living until the snow is removed and the hole is repaired, or until you find a new place to live.
It can also cover these expenses that exceed your usual obligations, which is a nice perk as well, especially if your hypothetical hotel doesn’t have a kitchen or washing/drying units and you have to utilize restaurants and laundromats more frequently than in the past.
More or less, renters insurance policies, in spite of all the differences they may have, tend to not cover the same things. Here’s a quick rundown of some of what you can count on not being covered: Your car is not covered under any circumstance – that’s what car insurance is for. Same applies for motorcycles, or aircrafts, or anything of the sort. However, property renters insurance can cover the items you have insured within the car, such as laptop or portable radio.
Data is also not covered under property renters insurance – an important distinction to make, since hardware that contains data is typically covered. The data itself isn’t covered, and additional insurance options should be sought by those seeking to protect their data.
There are a few other scenarios and items that property renters insurance does not cover. Damage from most natural disasters, terrorism, or nuclear war (scary thought, but still) are all not covered under property renters insurance. There are different policies available for these types of coverage. Surprisingly, property damage caused by pests such as bed bugs, cockroaches or rodents is not covered under renters insurance, either.
Items of high value typically can only be covered under property renters insurance policies under purchased additional coverage, and even then, these items are typically only covered in part. Insurance companies can only afford to pay out so much per policy and still keep the operation running, so this makes sense. If you’ve got pricier items, look elsewhere for additional insurance you can purchase for protection.
Who does property renters insurance protect? The short answer is you, your property, and anyone seeking damages in a claim in which you are found liable for the damages. Your spouse and any family members are also protected.
Your roommate’s personal property, if you’ve got one, is only covered if that person is related to you or your spouse. If they aren’t, your property renters insurance will not cover their personal property, unless you are liable for damages to their personal property. This is an important distinction to make, since many think that renters insurance provides blanket coverage for anything and everything within the property. If your roommate wants to have their personal property covered, they need to get a property renters insurance policy of their own.
Surprisingly, you can also provide coverage for a guest in your home – as in, someone staying for the weekend.
If somebody breaks into your rental and steals a visitor’s laptop, and you have insurance, the laptop would be covered.
Every pet owner who rents a dwelling should strongly consider getting property renters insurance. Property renters insurance covers the policyholder and their personal liability. This explains why if your dog bites your buddy helping you move a couch and your buddy sues you for the medical costs, your property renters insurance will cover you.
In addition, if your pet were to cause damage to someone else’s property, the damage would be covered. This coverage is available for incidents in and outside of your home. Please keep in mind that damage to your property and any injury to you or your household will not be covered. Damage to the rental caused by your pets is not covered as well. So if your pet damages the carpet or scratches the walls, it will not be covered by property renters insurance.
Not all pets are covered though. Some breeds and species are not accepted for property renters insurance purposes. Also, if your pet is a known biter, the pet may be excluded from coverage. If you have a pet that can not be covered by property renters insurance, you may want to consider an umbrella policy or a pet liability insurance.
Under property renters insurance, pets are not classified as personal property. Therefore, if your pet is injured by a covered incident, the injury will not be covered. With this in mind, you also will not be reimbursed by property renters insurance for lost or stolen pets. Also, property renters insurance will not cover your pets wellness. Basic property renters insurance will not cover veterinary or final expenses. Pet concerns are probably best covered under a pet insurance policy.
The best argument in favor of why you need renters insurance is its affordability. The average renters insurance plan costs about $180 a year, or $15 per month. There’s some nuance you need to understand – including premiums, deductible, policy limits, and the way in which your property can be replaced. The big takeaway though should be that no matter your financial situation, $15 per month to hedge against thousands in potential losses makes having renters insurance a no brainer.
An insurance premium is the amount of money you’ll pay for an insurance policy. This is a variable amount that you’ll pay per month to enroll in the renters insurance policy of your choice. This is primarily dependent on how much liability coverage you want, and how much personal property you’re seeking to have covered. Renter’s insurance premiums are also affected by outside factors, including your neighborhood and the condition of the building, which makes sense, given living in a high-crime neighborhood or in a 400-year-old building comes with a higher probability of risk.
The average annual premium varies quite a bit by state, but fluctuates between $120 and $258. Your credit score also factors into the equation. But mainly, how much you want covered and the sort of liability you want to be protected from are the biggest determinants of what your premium will be. Think of a premium as a hedge against the risk of renting. If you want more personal property covered, it’ll end up costing more for the premium, and without the insurance policy in place, would cost you significantly more.
An insurance deductible is the amount of money you’re willing to pay before the insurance policy kicks in to cover your losses or damages. Deductible amounts are flexible, but are usually set at $250, $500, or $1,000. When enrolling in a policy, the deductible you are given is largely your decision, and directly affects the premium you pay monthly to be covered by property renters insurance. If you’re willing to pay a higher deductible, your premium will be lower; the same being true in the inverse.
Another example comes in handy when trying to imagine which deductible amount is correct for you. Let’s say when carrying that couch up the stairs with your buddy, instead of ruining your apartment and your friendship, the couch itself makes it into the apartment intact, and a month later is ruined by an overhead burst pipe. It’s been ruined by forces outside of your control, and the claim you put in with your insurance company kicks in to help you cover the losses on your $1,000 couch.
If your deductible had been $500, you’d need to first pay that amount before receiving an insurance disbursement for the other $500 from your property renters insurance policy. If your deductible amount was $250 instead, you’d pay that amount, and then receive $750 in disbursements from your insurance company.