To put it simply, renters insurance is the type of insurance that tenants get to protect their personal belongings. If you’re renting out an apartment or a house, the homeowner insurance your landlord has only covers the physical structure of the house. So in case of a burglary, fire, or a natural disaster, your personal belongings in the house aren’t insured. That’s of course if you don’t have renters insurance.
Unlike you might think, renters insurance actually comes in quite cheap. For just $20 a month or so, you can get coverage up to $30 to $50 thousand for your personal belongings. There aren’t that many types of renters insurances but the policies vary depending on the coverage. While some renters insurance policies do not cover natural disasters like floods, some policies might not include burglary in high-crime areas.
Renters insurance not only covers the personal belongings in the house you’re renting. It also has protection against liability claims. The liability portion of the renters insurance protects you for the costs of legal claims. If a visitor to your rented home is injured and decides to file a lawsuit, your defense costs will be covered. This amount is usually up to $1 million.
Renters Insurance Costs in 2020
As we’ve mentioned earlier, the cost of renters insurance is affordable. You are expected to pay a maximum of $400 annually for a normal renters insurance policy. The amount you pay towards your renters insurance will vary depending on what’s included in your policy.
The data from 2019 suggest that the national average for a renters insurance policy is $15 to $30 per month.
These policies have coverage for loss of personal property. The ”personal property” includes household furniture, collectibles or other valuable items like jewelry. Coverage for loss of any jewelry or any other collectibles is included in your personal property coverage.
In case you’ll need your renters insurance, it will only cover your loss. The insurance company will not directly put the coverage money into your account.
What exactly renters insurance cover?
Renter insurance will provide financial reimbursement to cover any loss or damaged possessions of yours as a result of burglary, natural disasters (some), and fire.
Other things that could potentially damage your belongings like dog bites or bed bugs are mostly not covered. So if you have pets, know that damages caused by them will not be reimbursed.
The floods, on the other hand, is a very controversial topic in renters insurance policies. Most renters insurance policies will not cover damage caused by floods or water damage. However, you can always purchase flood insurance separately to secure your personal property from flooding.