You’ve heard the dreaded renter panic stories. Valuables stolen after a home break-in. A leaking toilet upstairs causes a ceiling to collapse and ruins your personal belongings. A broken water line to the ice maker floods the entire home, leaving you stranded without a place to live. If this sounds familiar thinking of a friend or family member who suffered through a similar narrative, you know that insurance is a necessity no matter whether you rent or own your home.
Renters insurance doesn’t cover everything.
Some things that it may not cover are:
- Bedbug infestation.
- Don’t expect your roommate’s policy to cover your things.
- Earthquakes
- Flood (natural)
- Damage done to your property by a guest or visitor.
- Waterbeds
What does renters insurance cover?
- Renters insurance can cover dog bites. Most renters insurance policies come with a minimum of $100,000 in personal liability protection and can easily be increased to $300,000 and up for a relatively small increase in premium. This would cover any injuries incurred, as well as the cost of legal defense in the event of a lawsuit.
- Most renters insurance can cover damage to belongings stored off-site. Check with your carrier, most renters insurance policies will cover up to 10% of your contents coverage off-premises.
- Renters insurance can cover travel. Let’s say your luggage is stolen while in Las Vegas. Your renters insurance may cover it. As always, check with your carrier.
- Renters insurance can cover relocation. Your renters insurance policy won’t cover the costs of a cross-country move, but if you have to relocate due to fire, water damage, or any other claim that makes your rented home unlivable, you should be in good shape.
- Renters insurance can cover theft from your vehicle.
- Renters insurance can cover the food in your refrigerator. Food spoiled because of a power outage or failed appliance should be covered as personal property.
- Break a friend’s window? Renter’s insurance covers that too.
- Smoke or fire damage (Only if accidental.)
- Vandalism
- Personal property stolen at locations outside your rental property.
- It covers the cost of injuries sustained by guests in your rental.
Despite the extensive coverage, many renters still go without renter’s insurance. A poll conducted by the Insurance Information Institute found that only 37% of renters carried a renter’s insurance policy. Compare that with 95% of homeowning respondents who carried a homeowner’s insurance policy.
I know I’m pushing pretty hard on renter’s insurance, but I do want to point out that renter’s insurance isn’t a complete panacea.