10 Most Commonly Asked Questions about Renters Insurance

Are you renting an apartment or a property? If so, renters insurance is your best friend. In the unfortunate event that something bad happens in your home or business space, having renters insurance can protect your properties and lessen your liabilities. In a world of uncertainties, getting insured is one constant that will give you security, and more importantly, peace of mind. 

From fire to theft, you never know what disaster is lurking in the future. Your landlord’s insurance only covers the building’s physical structure, leaving you and your personal belongings vulnerable. 

Needless to say, renter’s insurance is consequential. However, it’s normal to still feel on the fence about getting it. Here are some questions that might be floating in your head, as well as some helpful tips to solve them. 

1. What is renters insurance?

A subtype of property insurance, renters insurance protects tenants who live in rented dwellings such as apartments, condominiums or homes. This policy can cover your personal belongings from your rented property in the event that they get damaged, lost or destroyed from your rented property. It can also settle legal costs if you ever get sued for accidental property damage or bodily injuries against others. Even your vehicle can be covered in some policies.

For safety and security, getting renters insurance on top of your other policies is a great investment. It doesn’t matter if you plan on staying at your rented unit or if you’re thinking of a quick stay. Renter’s insurance covers a lot of damages and liabilities. Not getting insured is something you’ll regret if an accident ever strikes.

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2. What is covered by renters insurance?

As a personal insurance policy, renters insurance covers three main points: personal belongings, liabilities and additional living expenses. 

A. Personal Belongings

In the event that theft or natural disasters fall upon your area, these are some of the personal items that can be covered under your insurance policy:

• Furniture
• Appliances
• Electronics
• Wallets/Purses
• Gadgets
• Power tools
• Accessories
• Clothing
• Medicine
• Vehicles (double-check with your insurance provider)

B. Liabilities

Imagine having guests over, and your dog accidentally bites someone after mistaking them for a danger. If your guest decides to sue you for damages, renter’s insurance makes sure that your legal fees are covered. This also covers all property damage and accidental bodily harm caused by you, your family or your pets to other people while in your rented property. 

In some cases, this policy can cover anywhere from $100,000 to $300,000. Regardless of the court judgment, you will be given assistance through your insurance

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C. Additional Living Expenses (ALE)

Ever heard of Additional Living Expenses or ALEs? This is an insurance policy that covers any additional cost of living incurred during a time when a tenant is displaced from their dwelling. Up to 20% of the insurance can be claimed as reimbursement for the out-of-pocket expenses.

In the event that an apartment building becomes uninhabitable for a period of time due to repairs or any other reason, displaced tenants will be assisted by the renter’s insurance. Included expenses are: 

• Food costs
• Hotel/Accommodations
• Laundry expenses
• Storage costs
• Pet boarding

3. What is not covered by renters insurance?

Renters insurance is a comprehensive plan, but it does not cover all properties and perils. Why? Simply because those specific things are out of scope, and will be covered by other insurance plans. 

When it comes to property protection, things not included in your insurance plan are structures and permanent fixtures; these are included in your landlord’s insurance. Items in your unit that are not owned by you personally are also excluded from the plan. Lastly, objects that are kept outside your dwelling such as welcome mats, mailboxes and other items are also not shielded against theft, damage or destruction. 

Such a policy also protects you from calamities and disasters. However, some specific perils are not covered under renters insurance. There are usually two: floods and earthquakes. In the event that there is property damage incurred during either of these two calamities, it will be covered specifically by insurance targeted towards them.

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4. Can I include someone else in my insurance?

In most cases, no. Renters insurance is an individual plan that only covers the client alone. When two people share the same living space, they usually have two separate policies covering their own personal belongings and liabilities. 

However, that isn’t always the case. Some policies are specifically tailored to renter’s insurance for roommates. Finding such deals is rare, but if you’re ever lucky enough, you and your roommate will get to share the benefits while splitting the costs.

5. What happens if I don’t get renters insurance?

Not having renters insurance is a big risk in today’s world. With increasing crime rates and disruptive weather calamities, being uninsured can lead to serious harm. 

You will not be reimbursed or safeguarded in times when your personal belongings get stolen, damaged or destroyed. This means that you will have to repurchase these items with your own hard-earned money to replace them. 

In the event that an accident happens inside your home, you will have to pay all legal charges upfront and out-of-pocket. 

The same goes for your ALEs. If your landlord ever decides to renovate, you will have to find your own temporary accommodations and shell out money for additional living expenses. 

All of these scenarios can be easily avoided with renter’s insurance. So don’t wait. Get insured today!

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6. Is my pet covered by renters insurance too?

It depends. Most insurance companies do cover your pets. If your dog ever bites a guest in your home, medical and legal expenses can be charged under the liability clause of the insurance. However, this varies from company to company.

A good rule of thumb is the smaller the pet, the more insurable it is. This means that, unfortunately, there are some breeds of dogs that are blacklisted from renter’s insurance due to their size and nature. Here are some of them: 

• Pitbulls
• German Shepherds
• Rottweilers
• Wolf-hybrids
• Siberian Huskies
• Great Danes
• Akitas
• Chow Chows
• Mastiffs
• Alaskan Malamutes

It’s important to check your pets with the insurance company before closing the deal.

7. How can I calculate the value of my things?

First create a detailed list of all your belongings along with their prices. Everything inside your home from big appliances to little trinkets should be included. These are the items that will be covered under the property clause of your plan. 

Ideally, the list should be arranged from the priciest to the cheapest item. So start with the appliances and jewelry, then work your way down to the smaller things with lesser value. Sum up all the costs, and compare that number with the plans provided by your insurance company. 

Renters insurance is usually sold in 10,000-dollar increments, so find the plan that gives your overall property cost a little wiggle room if ever something is stolen or destroyed.

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8. What are the benefits of renters insurance?

Just like all other insurance policies, renters insurance offers a lot of benefits regarding your safety and wellbeing;

• It protects your properties and yourself
• It might be required by your landlord
• It safeguards your items when you travel
• It covers displacement fees
• It is affordable (around $15-$30)

If you’re looking for more reasons, reach out to your insurance provider to learn about the perks of getting renters insurance.

9. What are “perils?”

When reading through the agreement papers, a client might see the terms “named-perils” and “open-perils.” Perils are the technical term for any events that might cause or impose danger on a renter’s dwelling, properties and wellbeing. 

Essentially, these are natural or human-inflicted disasters that are specific risks or causes of loss. Most insurance policies cover the following perils:

• Fire
• Storms
• Explosions
• Volcanic eruptions
• Hail
• Riots
• Vandalism
• Theft/Burglary
• Falling objects
• Smoke damage
• Leakage
• Short-circuiting

10. What’s the difference between RCV and ACV?

RCV stands for Replacement Cost Value, while ACV stands for Actual Cash Value. These are replacement options under a renter’s insurance that covers property damage or loss. So what’s the key difference between the two? 

If you’re on a budget, getting an ACV can be enough to lessen costs if your property ever gets damaged by a peril. However, if you want full coverage in damages, RCV is the way to go. In this case, you’ll have to pay an extra fee, as this option is not included in standard renters insurance. 

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Conclusion

RA renter’s insurance is essential for tenants who want to safeguard their property and liabilities. It might seem like a hefty price to pay for hypothetical situations, but in the unfortunate event that accidents and calamities do happen, this insurance plan will prove to be important. 

Be wise in the kind of plan you invest in because it just might save your finances in the future.