Renters insurance covers personal property damage or theft, personal liability damages, emergency medical expenses for guests, and additional living expenses if you need to move temporarily. however, your insurer will not reimburse you for every event related to these coverages, as only certain events qualify for a claim.
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We recommend that anyone who rents a residence consider purchasing a renters policy as an inexpensive way to protect against the financial impact of such events.
what is renters insurance?
Renters insurance protects renters from the costs of unexpected personal property damage, theft, and legal liability. This coverage can be purchased by anyone who rents an apartment, condo, house, or other living space, and is much less expensive than homeowners insurance.
rental insurance providers range from established insurance names like state farm and allstate to newcomers like lemonade.
what does renters insurance cover?
Renters insurance generally provides four types of financial protection:
Combined, these coverages provide substantial financial protection against unexpected events, but it’s important to understand exactly which situations are covered and which are not.
Most renters insurance policies include $100,000 of liability protection, which covers costs associated with a lawsuit or damages.
Although it is unlikely that a person will have a claim against them, damages can be extensive in the rare event that it does happen. Let’s say a visitor trips and is injured. they could potentially file a lawsuit against you to cover your medical bills. Or suppose your dog bites a guest: The average cost of a dog bite claim in the US. uu. it’s around $35,000. Personal liability coverage will reimburse you for attorneys’ fees as well as any damages the policyholder may be ordered to pay to the plaintiff.
One caveat is that insurance companies often write in their policies that they will only cover the costs of an attorney of their choosing. Insurance company-appointed attorneys are generally experienced litigators and work on behalf of their assigned clients.
Should your apartment become uninhabitable, your renters insurance will help pay for the higher costs of living away from home through additional living expense (ALE) coverage. Like personal property coverage, beer only applies if your home becomes uninhabitable due to a covered loss; in other words, one of the perils covered by your renters insurance policy. this coverage is called loss of use.
Renters insurance policies include limited coverage for medical payments if guests are injured at your residence. this could include your hospital stay, surgical procedures, x-rays, dental expenses, and other related costs. Unlike liability coverage, the fault of the injury doesn’t matter, so regardless of the cause, your guest may be covered under this category up to the policy limits, which generally They range from $1,000 to $5,000. this coverage is extended exclusively to guests, so it will not cover anyone who lives in the property or is included in your policy.
In addition to the four main coverages, renters insurance provides supplemental coverages.
There are a number of add-ons or endorsements that a renter can add to their policy. these may increase coverage limits or cover perils not otherwise covered, such as earthquakes or floods. renters insurance policies may also offer additional coverage for more unique perils, such as a sinkhole endorsement.
If the coverage you need isn’t available as an endorsement, you may need to purchase a separate policy to ensure you have adequate coverage.
what doesn’t renters insurance cover?
The personal property and liability coverage provided by renters insurance will not protect you from all risks. for example, property damage due to flooding will not be covered and liability coverage for events involving dangerous breeds of dogs may also be excluded. coverage may be limited for high value items such as jewelry. These are some of the most common coverage limits and exclusions in renters insurance policies.
renters insurance does not cover all risk property damage
Renters insurance will rarely, if ever, cover damage to your personal property from some specific perils, such as earthquakes, riots, and pests.
bedbugs and pests
Most renters insurance policies will not cover damage costs associated with bed bugs, with limited exceptions. along with rodents, they are considered a maintenance issue and are not covered by your standard renters policy.
damage from earthquakes and floods
Standard renters policies do not cover earthquake or flood damage, although some companies may offer a supplement. If you can’t get earthquake or flood coverage through your renters insurance policy, you can purchase a separate flood or earthquake policy.
car theft or damage
Your rental policy does not cover damage to or theft of your car. You’ll need a comprehensive auto insurance policy. however, the belongings inside your car at the time of the theft are covered by renters insurance.
Renters insurance generally does not cover damage associated with your roommate’s belongings. to be covered, they would have to be included in the policy.
However, we do not recommend adding roommates, unless they are relatives or spouse. adding a non-family member to your policy will split the coverage among everyone assigned to the policy. therefore, if your policy insures up to $20,000 in damages, you and your roommate would split that coverage for all of your possessions.
renters insurance has lower limits for expensive personal property
Renters insurance personal property coverage limits do not apply equally to high-value items. jewelry and electronics may be covered by separate sublimits because of the high monetary risk posed by damage or theft. If you own expensive items, be sure to purchase a renters insurance policy where you can increase the sub-limits to ensure you are fully covered.
renter’s liability coverage may exclude specific incidents
While liability insurance covers most costs related to legal liability, there are some important exceptions for pets. Bodily injury caused by a pet, such as a dog bite, may be covered under renter’s liability coverage, but policies may exclude these events under certain circumstances.
Many insurers exclude coverage for certain dog breeds, such as pit bulls or bully breeds and mixes, and may even deny coverage if you own one of their prohibited dog breeds. Exotic pets, such as reptiles or monkeys, may not be covered by renters liability insurance. Some progressive companies like state farm don’t consider your dog’s breed and won’t deny you a policy because of your dog’s pedigree.
Finally, like property damage coverage, renters insurance liability coverage will not extend to your roommate unless they are family.
how do renters insurance companies pay claims?
Your insurer will only cover you if you file a claim – an application to the insurance company for compensation for a covered loss. A renter could file a claim for damage or theft of personal belongings, personal liability coverage, or additional living expenses incurred. A property damage claim process will consist of several steps.
Filing a claim can be a lengthy process, but the more information you have available to your insurer, the more likely you are to expedite your claims process and receive timely compensation for your loss.