Homeowners Insurance Information
What is Renters Insurance?
Renters insurance provides financial protection against the loss or destruction of possessions when renting a home or apartment. While your landlord may be sympathetic to a burglary you or a fire caused by your iron, destruction or loss of your possessions is not usually covered by your landlord’s insurance. Because in most cases, renters insurance covers only the value of your belongings, not the physical dwelling, the premium is relatively inexpensive.
Renters insurance covers your additional living expenses should you be unable to live in your home or apartment due to fire or other covered perils. Most policies will reimburse you the difference between your additional living expenses and your normal living expenses but still may set limits as to the amount they will pay.
By purchasing renters insurance, your possessions may be covered against loss from fire, smoke, lightning, vandalism, theft, explosion, windstorm and/or water damage (not including floods). Like homeowners insurance, renters insurance also covers your responsibility to other people injured at your home or elsewhere by you, a family member or your pet, potentially paying out legal defense costs if you’re taken to court.
There are generally two types of Renters Insurance policies:
- Actual Cash Value – Pays to replace your home or possessions minus a deduction for depreciation up to the limit of your policy
- Replacement Cost – Pays the actual cost of replacing your home or possessions (no deduction for depreciation) up to the limit of your policy
With either policy type, you may want to consider purchasing a floater. A standard renters policy offers only limited coverage for items such as jewelry, silver, furs, etc. If you own property that exceeds these limits, it is recommended that you supplement your policy with a floater. A floater is a separate policy that provides additional insurance for your valuables and covers them for perils not included in your policy such as accidental loss.
Back to Homeowners ArticlesObtain a Homeowners quote
Information provided with permission from the Insurance Information Institute, Inc.