If you rent a house or an apartment and think that your landlord is financially responsible when there is a fire, theft or other catastrophe, think again. Your landlord may have insurance to protect the building you are living in, but your landlord’s policy won’t replace your personal possessions or pay for your living expenses while the building is being repaired.
The only way to protect yourself financially against disasters is to obtain a renters insurance policy. Renters insurance covers your possessions, liability and additional living expenses. Let’s take a look at the three types of protection.
Standard renters insurance protects your personal belongings against a variety of perils such as fire, smoke, theft or water. To decide how much insurance you need for your possessions, you’ll need the value of everything you own, including furniture, clothing, electronics, kitchen utensils, and even towels and bedding. The easiest way to figure this out is to create a home inventory- a detailed list of all of your personal possessions and their estimated value.
There are two types of coverage for your possessions: Actual Cash Value and Replacement Cost. Actual Cash Value pays to replace your items minus an amount for depreciation (the reduction in the value of items due to age and use) up to the limit of your policy. Replacement Cost pays the full cost of replacing your possessions (with no deductible for depreciation) up to the limit of your policy. The cost of having Replacement Cost Coverage is a little higher, but can be well worth the additional premium.
Standard renters insurance provides liability protection in the event you or members of your family cause injury to others or damage to other’s property. If you are sued, the liability portion of a renters policy may pay for both the cost of defending you in court and up to the limit of the policy.
If visitors are injured in your home, you may also have medical coverage to cover their injuries, regardless of fault. It does not; however, provide coverage for your own family.
Additional Living Expenses
Many people are pleasantly surprised to learn that Additional Living Expense coverage is typically included in a renters policy. If the home or apartment you are renting is damaged or destroyed and you need to live elsewhere while it is being repaired, renters insurance will cover your additional living expenses, such as hotel bills, temporary rentals and meals.
To recap, if you rent a house or an apartment, your landlord’s policy won’t replace your personal possessions or pay for your living expenses while the building is being repaired. The only way to protect yourself and your possessions in the event of a loss is to obtain a renters insurance policy. If you do have questions regarding an in force or possible renters policy, please give us a call at 701-365-0515, we are happy to help.