Not everyone fully understands the importance of having renter insurance or are even aware that it exists. They mistakenly think if they don’t own the property, they don’t need insurance because everything is covered under the landlord’s homeowner’s insurance. Get the true facts here.
Renters or rental insurance is a policy that protects you and your personal property when you rent your home from someone else. It’s slightly different from homeowner’s insurance in that it only covers your personal property like furniture, appliances, clothing, etc. It does NOT cover the building. That’s up to your landlord or the one who owns the property.
Anything inside your home that might be damaged or destroyed will be protected under your rental insurance as long as the damage came from a covered peril like storms, fire, vandalism, theft, etc. If you can’t live in your home while it’s being repaired, the insurance may also pay your living expenses during that time. This may even include groceries.
Renters insurance usually pays either actual cash value (depreciation value) or replacement value depending on the type of policy you purchased. Replacement value means what it costs to actually replace the item for the same thing. Actual cash value means what the item is actually worth now due to depreciation.
A policy with replacement value is going to be more expensive than one with actual cash value. Like with home insurance, there will be a deductible you’ll have to pay each time you submit a claim. The higher deductible you choose, the lower your premiums will be. The amount of rental insurance you purchase is based on what you feel all your possessions are worth or what it would cost you to replace if everything was destroyed.
Your renter insurance also offers liability coverage to protect you against lawsuits in case someone who is injured while visiting you decides to sue you. It also offers medical coverage in case the individual needs medical care.
Renters insurance offers many benefits, but the biggest benefit is the peace of mind it provides you in knowing that your most precious belongings will be replaced or repaired if they’re damaged without you having to cover the loss yourself.