Renters Insurance: What Does it Cover?

According to data from the latest Census, over 36% of Americans rent their homes.

When settling into your new home, it may be wise to consider renter’s insurance. While no one plans for a break-in or fire, these incidents can cause devastating loss. Renters insurance is an important coverage that can potentially cover the losses incurred from these unexpected events. Infinity Insurance Agency, Inc. (IIA) understands you may have questions regarding renters' insurance and its benefits. Renters insurance is defined as a group of coverages designed to help protect renters living in a house or apartment.  

Read on to discover the importance of securing renters' insurance and determine if this coverage is right for you.

Renters insurance: what does it cover?

Wondering what is covered by renters insurance? Many renters assume they are covered by their landlord's insurance policy. Unfortunately, in most cases, your landlord’s insurance will not cover your personal items in your dwelling such as jewelry, electronics or furniture.  

Typically, renters' insurance includes the following three coverages:

• Personal property coverage - It may cover the costs to repair or replace your belongings such as clothing, furniture, and electronics up to the limits of your policy. For example, if someone breaks into your home and steals your TV, you may be covered under personal property coverage.  
• Liability protection - It may cover the costs of damage or medical bills if someone is injured on your property, or you accidentally damage someone else's property while it's at your dwelling. For example, if you throw a party and someone trips and falls, liability coverage would cover their medical expenses up to the limits of your policy.
• Additional living expenses (ALE) - It may cover additional costs incurred, such as hotel bills if your residence is left damaged or uninhabitable. For example, if your apartment was left uninhabitable due to a fire, ALE can potentially cover the cost of alternative lodgings.

It is not uncommon for renters' insurance to not name specific coverages, rather it will state common perils or disasters that you may be covered from.  

Typical perils that could be covered by your renters’ insurance policy may include:

• Fire or lightning
• Windstorms
• Smoke
• Vandalism or malicious mischief
• Theft
• And accidental discharge of water*

*Please note that accidental discharge of water does not refer to flooding due to weather. Accidental discharge of water refers to a burst pipe that accidentally floods your unit or damage incurred by an upstairs tenant overflowing their bathtub, (III).  

Property liability coverage can potentially cover medical expenses if a third party is harmed on your property, although this coverage will only apply when the policyholder is deemed at fault. In contrast, medical payments coverage can be applied to cover medical expenses no matter who is at fault.

What does renters' insurance not cover?

While renters' insurance may offer peace of mind from many perils, there are exclusions to most policies. Common policy exclusions can include but are not limited to:

• Damages incurred from natural disasters such as floods, earthquakes, and hurricanes
• Damages incurred intentionally  
• Coverage for specialty items such as antiques, art, guns, and precious jewelry

Work with your agent to make sure you thoroughly understand your policy's exclusions and if necessary, inquire about a specialized policy. Aim to obtain sufficient coverage for your most valuable items.

Is renters' insurance worth the cost?

The cost of your renter's insurance will vary greatly depending on how much coverage you choose to obtain and what deductibles you select. Coverage limits can vary, and you’ll want to obtain a policy that can cover your most valuable belongings. Generally, higher deductibles will lower your insurance costs while a lower one will raise it. Consider if you would be willing to pay out of pocket for the loss of your belongings. It can be helpful to create an inventory of all your valuable belongings to ensure you select a policy with limits that will be sufficient to cover these items. Remember, you should continuously update this inventory and your policy as you purchase new items.

FAQs

Does renters' insurance cover personal injury?  

Yes, generally renters' insurance will cover personal injury but only to third parties. So, if someone is injured on your property your renter's insurance may potentially cover the costs/medical expenses associated with the other party’s injury if the renter is liable in some manner.

Does renters' insurance cover property damage?

Typically, renters' insurance may cover property damage to the renter’s property if it is caused by a named peril such as fire, windstorm, vandalism, or theft.  

Does renters' insurance cover theft?

Renters insurance will cover instances of theft to the renter’s property up to the limits of their policy. Please note that items of special value such as jewelry, guns, art, and antiques may require their own special policy.  

Does renters' insurance cover mold?

It depends! If the mold in the renter’s personal property was caused by a named peril such as a burst pipe it will typically be covered. Mold caused by negligence to the renter’s personal property, such as a leaking shower head will typically not be caused by renters' insurance.  

Your home should be a sanctuary and a place where you feel comfortable storing your most valuable possessions. Renters insurance can be an important step in helping protect your possessions from certain accidents and mishaps that can come along with renting.  

Want to learn more about our partner’s renters’ insurance options or receive a free auto insurance quote from IIA? Give us a call at 1-855-478-3705 to speak to an agent today!