As renters, we never consider what will happen to our belongings in the case of a disastrous event. Many who live in rental properties are unaware that their belongings are not covered by the insurance policies purchased by their landlord. The property owner’s policy will only cover the cost of repairing the structure in the event of a disaster and will not contribute to the replacement of any of the personal items of the tenant.
According to a study performed by Harvard University, 36.4 percent of U.S. households were occupied by renters in 2015. However, only 37 percent of those renters elected to purchase Renter’s Insurance, as opposed to the 95 percent of homeowners who carried a Homeowner’s Insurance policy, according to the Insurance Information Institute.
Coverage for Personal Possessions
Homeowner’s Insurance covers only the structure and belongings of the person who owns the home. The insurance policy will not cover anything that belongs to the renter. This means that any televisions, clothing, large appliances, furniture, computers, cell phones or other costly items will not be replaced if destroyed while inside the home.
Renter’s Insurance is intended to cover loss of personal property if that loss is due to a disastrous event. Select policies will also replace items that are damaged or stolen due to theft or burglary.
Additional Living Expenses
Additional Living Expenses coverage is also offered with most Renter’s Insurance policies. This coverage is intended to aid renters if the property in which they are living is destroyed. This includes the cost of living elsewhere, hotel bills, restaurant meals and other expenses incurred while the home is being repaired or rebuilt.
Renters Insurance also provides tenants with options for liability protection. This includes coverage against lawsuits for bodily injury to others or property damage caused by the tenants, their family or their animals. Policies can also include no-fault medical coverage to cover claims of someone injured on the property.
Discounts for Renter’s Insurance are often given to those with existing policies with the insuring company or with homes that have a security system, smoke detectors or other security or safety measures.
To find out more about Renter's Insurance or to purchase a policy, visit an Opportunity Tax and Insurance Service location near you.