Here is a question: If you are living in your parent’s house or with relatives and your belongings in the home are stolen or damaged in a fire or burglary, what will happen? Will the insurance company pay for the replacement of your stuff?
If your answer is yes, you are absolutely correct. Your parent’s or relative’s insurance policy will pay for the damage because it extends coverage to you.
Here is another question.
What if you are not living at home or with relatives but in a rented apartment, what would happen if your belongings were lost or stolen in a fire or burglary? Will the landlord’s insurance policy pay for any loss you suffer?
If your answer is yes, you are wrong. Your landlord’s insurance does not extend coverage to your personal belongings.
You’ll be surprised to know that most renters don’t know this. Many people carry the mindset they had when living in their parents’ home to a rental property. They assume the landlord is responsible for protecting their personal belongings from loss or damage. As Cressman Realty & Management warns, this misconception is the reason why many renters sustain huge losses when something bad happens in a home they are renting.
The reason landlord’s insurance omits a tenant’s belongings from the list of things covered by the policy is that landlords are not responsible for what renters do in their homes. Parents have some measure of control over their children and those who live under their roof. It makes sense to include them in homeowner’s insurance. But this is not the case when you are renting.
How to get insurance if you are renting
Does this mean that renters are completely at the mercy of any unfortunate incident that happens in a rented home? No, this is not true.
Although you will not have coverage under your landlord’s insurance, you also don’t have to live without the protection of insurance. There is an insurance policy that is specifically designed for the unique needs of people renting like you.
This policy is called renter’s insurance. Unlike homeowners and landlord’s insurance, renter’s insurance does not require you to own the home where you live. It provides coverage for your belongings in the rental and provides for events that directly involve you. It ensures that even when you are not living in your own home, you have all the insurance protection you need.
Why you should get renter’s insurance
Many renters don’t feel they have enough personal goods to justify spending money on insurance. But this is simply not true; most tenants do not know how much their personal belongings are worth. They only start to find out after they lose them and have to replace them. Even if you live in a studio apartment, your personal belongings could easily amount to over $20,000.
When you have renter’s insurance, you get:
1. Personal property coverage
The policy will reimburse you if your personal belongings are destroyed by a peril named in the policy. Perils named in a renter’s insurance include damage by vehicles, falling objects, aircraft, explosion, fire, riots, lightning, smoke, theft, vandalism, volcanoes, ice, snow, sleet, electricity, hail, and a lot more.
2. Personal liability protection
The renter’s policy will protect you from legal liability if the landlord’s or a neighbor’s belonging is damaged through your negligence. It will also shield you from liability if a friend, neighbor, or stranger is injured inside your apartment. If you are sued and found culpable, it will pay the claims against you and the injured person’s medical bills.
3. Coverage for additional living expenses
If an accident renders the home you are renting uninhabitable, the policy will cover your additional living expenses. This could happen if there is a fire outbreak at the home or a tree falls on the house. While the home undergoes repairs, the renter’s insurance will pay the cost of emergency accommodations.
4. Coverage while traveling
If your personal belongings are lost or stolen while you are traveling in a covered country, renters’ insurance will pay the cost of the lost items. Additionally, if you leave your items in your car and the car is broken into and the items stolen, you will be covered under those circumstances.
5. Unrestricted access to quality rental housing
Having renter’s insurance guarantees access to the best rental properties. This is because many landlords make renter’s insurance one of the conditions for renting their home to you. They also do this because their landlord’s insurance may be invalidated if they don’t. Without renter’s insurance, you limit yourself to lower-quality rental homes.
With all of these benefits, you probably want to know how much a renter’s insurance costs. That is the best part, renter’s insurance costs less than most people spend on coffee every day. The average cost of renters insurance is $187, which is less than a dollar a day per year.
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