This site is privately owned and is not affiliated with any government agency. Learn more here.
Individuals and families who are renting their homes are in a unique position when it comes to insurance. The house or apartment building in which they live is insured under the landlord’s or owner’s insurance policy.
However, the renters’ personal belongings are not covered by the landlord’s or owner’s policy. For coverage on belongings, occupants need to obtain renters insurance. Personal injury may be covered by either the landlord’s insurance or the renters insurance, depending on the circumstances.
This multi-layered arrangement of insurance and liability can lead to overlapping coverage as well as unexpected coverage gaps. Misinformation and confusion about what situations and possessions are covered and under which policy is common among renters. Thoroughly reviewing their policies is the crucial first step for renters who want to make sure their homes, families and possessions are properly protected from the unknown. Here are the key things to look for and consider when reviewing a policy.
Emergencies come in many forms, from the mundane to the rare and terrifying. To complicate matters further, a single source or cause of damage can inflict harm on property or possessions in several different ways. For example, a storm might result in both wind damage and water damage. Most renters insurance providers offer coverage designed to accommodate the wide variety of emergencies and damages a home might endure.
Renters insurance also encompasses injury liability coverage. If a guest, visitor or service provider (e.g. the cable guy) is injured while in your home, then you may be legally liable for the cost of their medical expenses when they seek treatment for that injury. Renters insurance will cover those expenses, protecting your household from unexpected and burdensome medical bills. It is important to know the landlord’s responsibilities, as some incidences may be his or her obligation.
Although the basics of renters insurance, as listed above, are largely the same across insurers and policies, there can be significant variations in coverage as well. Insurers recognize that different households will have different needs. To accommodate diverse incomes, circumstances and geographies, most insurers provide a suite of customization options to help renters put together coverage appropriate to their personal situations.
One key form of optional coverage is Additional Living Expenses (ALE) coverage. ALE insurance provides extra financial assistance in the event that some qualifying disaster forces renters out of their homes for a period of time. It may also pay the difference between a household’s standard expenses and their new expenses during that time. For example, a family living out of a hotel room for a week while their home is repaired will need to eat out at restaurants or find other pre-prepared food for that time. This will inherently be more expensive than their usual pattern of eating primarily at home. ALE insurance would cover those additional dining costs.
Renters who own pets may need to review their policy options with their insurers to clarify what coverage, if any, the policy extends to damage or injuries caused by family pets. In some cases, supplemental coverage for pet damage may be available at a slightly higher cost.
Insurance coverage for costs associated with mold varies significantly between insurers and policies. While landlords and their insurance are typically responsible for cleaning up mold on or affecting the building itself, reimbursement or replacement funds for renters’ personal property that has been damaged by mold are often available only if the mold is the direct result of a qualifying emergency or incident. Insurance riders or clauses for general, non-incident-related mold damage may need to be specifically negotiated or requested when insurance coverage is purchased if renters want the reassurance of that coverage.
Renters can take comfort in knowing that their families, guests and possessions are covered by renters insurance in the event of an emergency. However, to make sure that they have the best possible experience with renters insurance, policyholders should keep the following tips in mind when selecting or updating their policies.