Many believe that the policies of their landlords will cover them. Some also believe that tenant’s insurance is simply a waste of time and money.
It should be noted that a landlord’s policy will cover things like appliances, structural problems, as well as pipes. However, their policy likely won’t cover your most valuable assets, which may include money, gold, jewelry, and electronics. Damage to such items won’t be covered even in a natural disaster, such as a flood, fire, or earthquake. Your belongings will also not be covered if they’re stolen or vandalized.
The costs of displacement will also typically not be covered by your landlord’s insurance policy, nor will they be held liable if someone is injured in your apartment.
As can be seen, tenant insurance companies have many benefits that many renters are not aware of. Here are the ways tenant insurance helps keep you and your valuables safe and more reasons why it’s important for renters.
What Is Tenant Insurance?
Tenant insurance is also referred to as renter’s insurance. It intends to provide tenants with financial security if their property is destroyed or severely damaged due to an insurable event.
Examples include vandalism, theft, flooding, fires, hurricanes, tornadoes, and earthquakes.
What Does Tenant Insurance Cover?
Tenant insurance can be broken down into three distinct categories in terms of coverage. Each category provides its own set of protections against numerous perils.
- Personal property coverage: covers the costs required to replace your personal belongings. Examples include home appliances, computer accessories, electronic gadgets, furniture, and jewelry.
Basic tenant insurance provides personal property coverage in the event of steam or water leakage or overflow. It’ll also provide coverage in the event of lightning, explosions, fire, aircraft damage, hail, and windstorms.
- Personal liability coverage and medical expenses: you’re provided with personal liability coverage in the event that you accidentally damage or destroy something while at someone else’s home. Also, if someone accidentally slips and falls while at your apartment, their medical bills will be covered by your insurance, even if you’re deemed responsible. In sum, you’ll be protected, regardless of whether or not you’re the victim or the one responsible for the damage or injuries incurred.
- Loss of use coverage: if your home is inhabitable for a prolonged period of time due to extensive water or fire damage, the costs required to stay at a hotel will be covered by your tenant insurance. However, loss of use coverage is temporary, meaning it should only be seen as a short-term solution.
Key Reasons to Have Tenant Insurance
You won’t be legally obligated to have tenant’s insurance in most rental situations, but it’s highly recommended. Some renters mistakenly assume that they will be completely covered under their landlord’s policy or too expensive.
In truth, it should be one of your top priorities while you’re looking for a new apartment. When looking for a tenant’s policy, consider the following to find one that’ll cover you in these situations.
- Personal Property Coverage: under your landlord’s policy, only major appliances that came with the apartment will be covered along with the physical structure. As for tenant’s insurance, it’ll cover most, if not all, of your belongings, including clothes, furniture and electronics.
- Personal Property Coverage While Traveling: if your belongings are stolen or damaged while you’re away, they’ll be covered. They’ll also be covered if you travel with them and they’re stolen or damaged.
- Protection for damages that you cause to someone else’s property: if you damage someone else’s property with your car or accidentally start a fire in someone else’s apartment, you’ll be protected.
- Liability Coverage: if you accidentally injure someone while they’re on your property or they injure themselves (i.e., slip and fall on your snowy driveway), then you’ll be protected. You won’t have to worry about paying for any legal and/or medical expenses that arise from injuries to others.
- Additional Living Expenses Coverage: if your home is damaged in a flood or fire, then your insurance may cover food, lodging, and other expenses while you’re living in another temporary domicile.
It’s important to note that tenant insurance is usually not mandatory in most cases for those who wish to rent an apartment. However, landlords are legally obligated to obtain it from prospective tenants before an agreement is signed.
All tenant insurance policies are also not the same, so you may want to compare and contrast offers from different companies. The peace of mind and protection you’ll obtain from the ideal insurance package shouldn’t be taken for granted.