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What is Renter’s Insurance and Why Do You Need It?

If you are a renter, does your landlord’s insurance cover you in the event of personal property loss or damage?

Ask many tenants and they will tell you they think it does. If you believe the same thing too, the Keyrenter North Dallas team warns, that assumption could cost you. 

A landlord’s insurance only covers the building and not the personal belongings of tenants living in the building. If an incident causes damage to the building and your belongings, only the building is taken care of.

So, who pays to replace or repair your stuff? You do unless you have renter’s insurance, in which case the insurer bears the cost.

What is renter’s insurance?

What is renters insurance

Renter’s insurance is a policy that offers insurance coverage for tenants living in a building. It ensures they are not left vulnerable in the event of loss or damage.

Personal belongings that may be included in the renter’s insurance include clothes, luggage, jewelry, computers, electronics, sports equipment, and furniture. There is a long list of perils that properties under this policy are protected from. 

They include damage caused by the following:

  • Fire or lightning or smoke
  • Electrical surges
  • Theft, vandalism, or malicious mischief
  • Falling objects
  • Riots and civil commotion
  • Explosions or volcanic eruption
  • Aircraft or vehicles crash
  • Weight of ice, snow, or sleet
  • Windstorm or hail
  • Water or steam from household appliances, plumbing, heating, air conditioning, or fire-protective sprinkler systems

Since your landlord’s insurance does not cover you and the renter’s insurance is so comprehensive, shouldn’t you get it?

Here are a few great reasons to get renter’s insurance.

Why you should get renter’s insurance

Why you should get renters insurance
  • Protection against theft

If a thief breaks into your apartment and makes away with your laptop or other belongings, the policy will pay for the loss. Furthermore, if the burglar steals your credit card and runs up fraudulent charges, the policy will protect you.

This is in addition to liability coverage if you borrow somebody’s property and it is damaged by, say, water from a leaking pipe.

  • Provides liability coverage
Provides liability coverage Renters Insurance

If someone is injured inside your home, such as when someone slips and falls or you accidentally injure someone while they are in your home, the policy covers you.

It will cover medical bills (regardless of who is at fault), legal fees, and any court judgment that results, up to the limit set by the policy. You are also covered if your pet attacks somebody.

  • Cover in case of negligence

If you negligently damage your landlord’s property, the policy will bear the cost of repairing the damage. This refers to the kind of damage that occurs when a tenant accidentally leaves a tap running and floods the building.

The policy not only covers the cost of damage to the building but also the cost of any damage suffered by the neighbors.

  • Coverage against theft outside the home

The theft covered by the renter’s insurance is not limited to theft that occurs inside the home. If your personal belongings are stolen during a trip overseas or from your parked car or at the airport, the renter’s insurance still provides cover.

  • Additional living expenses

Supposing something happens to cause the house you live in to become uninhabitable, renter’s insurance will cover the cost of living somewhere else temporarily. This will usually include the cost of staying at a hotel, food, and other necessary expenses.

  • Other benefits

For goods in self-storage, renter’s insurance provides coverage for a portion of your belongings. That is if the storage space is separate from your apartment. Also, if there is an electrical surge and your refrigerator is damaged, the policy covers the cost of replacing food that goes bad as a result.

How much does the renter’s insurance cost?

How much does the renters insurance cost

Considering the scope of coverage available under this insurance, it must be expensive, right? Wrong, renter’s insurance is one of the most affordable types of insurance policy there is.

On average, the monthly cost of getting renter’s insurance is around $17 and it can even be lower. Depending on which city you live in, the annual premium for a standard renter’s insurance is between $117 and $252 a year.

In most places in the United States, policyholders will pay around 50 cents a day. And for this tiny sum, they can get coverage for personal belongings worth between $30,000 and $50,000. Compared to paying out of pocket for loss or damage to your stuff, renter’s insurance is a really good deal.

So why don’t a lot of tenants have renter’s insurance? The reasons are twofold.

  • The majority of renters wrongly assume that their losses and liabilities are covered by their landlord’s insurance
  • Of the few tenants who know differently, many assume renter’s insurance is expensive

Only a few smart renters know that these two assumptions are false. Hopefully, you can be one of the few smart tenants who have renter’s insurance.

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