Renters insurance is in its simplest form coverage for tenants and their property when an unexpected loss occurs. Similar to other insurance policies, renters insurance protects you from paying huge unexpected expenses. Also known as tenant’s insurance, renters insurance is designed to reimburse a policyholder for damages caused by natural and unnatural threats. Most insurers provide standard coverage to their clients. Additionally, you can add other coverage for less-common threats, and items of high value. As most individuals who obtain renters insurance are renters, the question many individuals have is:
Can An Apartment Complex Require Renters Insurance?
Simply put, yes an apartment complex can include a provision in the lease requiring renters insurance.
Many renters assume that their landlord’s insurance coverage protects their personal property as well. Others believe that their belongings are not worth insuring. Others simply are not aware of renters insurance.
Sure enough, the landlord will have the property covered by an insurance policy.
However, the coverage does not offer protection for the tenant’s liability or personal belongings.
Your lease agreement may require you to have renters insurance coverage before moving in the apartment.
Though renters insurance is not mandatory in any state, your landlord may include it in the lease agreement.
What Does Renters Insurance Cover?
Renters insurance will generally provide coverage in the following areas:
- Personal property
- Liability and medical payments
- Property damage
- Loss of use
Renters insurance covers tenant’s personal belongings. While you may be able to afford to replace all of your valuable possessions, is it something you really want to do? Or if you can’t afford to replace everything, imagine how difficult of a situation it would be if you lost all of your belongings.
If you add up the total worth of all your belongings, you will be thoroughly surprised.
Renters insurance could reimburse you for a covered loss so that your lifestyle can continue should disaster strike.
Personal property coverage includes:
If you own expensive jewelry, you may need to buy what is referred to as a policy rider to ensure you have sufficient coverage.
This would be necessary for actual cash value rather than a replacement cost when placing a claim.
Personal property coverage protects your belongings from perils such as:
- Smoke damage
- Volcanic eruptions
- Falling objects
- And many more
Liability And Medical Payments
Renters insurance may also protect you from certain liabilities and medical payments. Liability coverage will pay for damages you cause to other people’s property and injuries to someone when you are at fault.
For example, you forget to turn off the stove while cooking and a fire causes damage to the apartment complex.
Or in another scenario, a guest in your home slips and breaks an arm; this policy will also pay for medical expenses incurred.
Similarly, you might be taken to court by a person who is bitten by your dog.
It does not matter if it happened inside or outside your house, the same policy will pay for the court process and bail.
The thing to remember about medical coverage is that it covers medical bills for other people, but not you.
Property Damage (Third-Party)
Third-party coverage will protect the tenant in case he/she causes harm to another dwelling.
If by bad luck you are not covered, your landlord might be asked to pay for the damage you caused.
Third-party damages covered by renters insurance are:
- Stray baseball through a window
- Propane tank explosions/outdoor grill accidents
- Overflowing a bathtub/sink/waterbed causing water damage to apartments below
- Driving a car or lawnmower into a fence
Loss of Use Coverage
Loss of use coverage is also called additional living expenses (ALE).
It is meant to cover additional living costs when a tenant is unable to live in a rented dwelling because of a covered damage or loss.
For instance, your rental unit is uninhabitable because of fire damage. How much would living somewhere else cost you while your home is being repaired?
Depending on the period you have to wait while your home is under repair, or relocate permanently, the cost could rise significantly.
That is when loss of use or coverage D comes to your rescue. Among the costs your insurer will reimburse you for include:
- Transportation fees
- Laundry expenses
- Storage costs for household goods
- Temporary accommodation such as a hotel
- Parking fee
How Much Renters Insurance To Buy
You should create a home inventory to determine how much coverage you need to buy.
Make a detailed list of your personal property and include receipts if possible. Add their total value and the figure you get is the amount you should insure your belongings.
Make sure the value you put on each item would be enough to replace them with new ones.
It is wise to take pictures and videos of everything you own. Remember to update your list every time you buy a new item and save it in a safe place or away from your house.
Choosing a Renters Insurance Policy
When shopping for a renters insurance policy, you need to know about the financial stability of the insurer. You need to be sure the company will pay when a claim is necessary.
You have to consider the availability of the insurer as well. A company which deals with clients directly 24/7 is better than one which does not. Service delivery is also crucial when choosing renters insurance. You want to talk to an expert who will give you a detailed and in-depth answer to your questions. Renters insurance prices vary widely, so you need to compare what at least three insurers are charging.
You can use this guide on your way to buying renters insurance. Should you want more information, contact one of our agents in Scottsdale AZ or Norman OK. We would love to help you find the policy that is right for you.