Living in a home of any kind comes with its risks. There is a long list of unpleasant things that can happen to the building, its occupants, or their belongings. The building could suffer flood or fire damage. A tree could fall on the roof or a burglar could break into the home. These are events no one wants, but which happen in the everyday course of life.
Bad things happen despite our best efforts to prevent them. This is why people buy insurance. Insurance offers assurance that if unexpected events destroy anything we have worked hard to gain, we do not have to start from scratch. To lessen the impact of the incident, the insurance company will provide cash to replace the lost valuables.
This is why landlords buy landlords insurance; in the case of loss or damage, their assets are protected. They know the building, their belongings inside it, and their rental business are covered in the event of a catastrophe. But there is one vital aspect of a rental that is not covered by landlord’s insurance.
What many renters don’t know about landlord’s insurance
A rental property is expected to have tenants, but tenants and their belongings are glaringly missing from the list of what is protected by landlord’s insurance. Is this an omission? Given that landlord’s insurance covers the building and the landlord’s goods inside it, should the policy not protect tenants and their belongings too?
Sadly, this is not the case. Many tenants assume their landlord is responsible for protecting them and their property from damage or loss. But this assumption is false. Landlords are expected to provide a safe and habitable dwelling for tenants. But if there is a flood, fire, or burglary in the home, the landlord’s insurance does not protect tenants.
Landlord’s insurance is specifically designed to protect a landlord’s rental business, and tenants are unfortunately not part of that. If there is a damaging incident in the rental, the insurance will discriminate between what belongs to tenants and what belongs to the landlord.
In reality, if you are a tenant relying on your landlord’s insurance, you actually have no insurance coverage. This is the reality. But there is an easy solution to this situation.
What is renter’s insurance, and why do tenants need it?
Renter’s insurance is a policy designed to meet the peculiar needs of people living in a rented home. As a renter, you do not qualify to buy homeowner’s insurance since you don’t live in your own home. At the same time, you don’t qualify for coverage under your landlord’s insurance. Renter’s insurance steps in to ensure you are not deprived of insurance coverage while renting.
Renters insurance offers protection in three important areas, namely:
• Coverage for your personal belongings
All kinds of personal belongings are considered under the policy; clothes, jewelry, electronics, furniture, cookware, and more. These are protected from a range of perils including but not limited to fire, theft, hail, water, electrical surges, vandalism, freezing, etc.
Renter’s insurance will replace lost or damaged items by paying their cash value ACV (Actual Cash Value coverage) or their replacement cost RCV (Replacement Cost coverage).
RCV policies pay enough money to buy a new item, but ACV policies will only pay the value of the item when it was lost or stolen; that is, enough to buy a used one.
• Protection from personal liability
Renter’s insurance also protects you against lawsuits if a neighbor, friend, or anyone suffers bodily harm while in your rented home. Not only will the policy cover the cost of hiring a lawyer, but it will also pay the injured person’s medical bills and if there is any award by the court against you, it will pay that too.
• Additional lining expenses protection
Renter’s insurance will save you if your rented home becomes unlivable because it is damaged. In this situation, tenants may assume the landlord is responsible for making alternative living arrangements for them. This is not true. However, if you have renter’s insurance, you have nothing to worry about.
Other benefits of renter’s insurance include:
• Renter’s insurance will cover valuables that are stolen from your parked car.
• If your things get lost or stolen while you are traveling in a covered country, you will be compensated.
How much does renter’s insurance cost?
For less than what it costs to buy a cup of coffee, you will get coverage in the tens of thousands of dollars. On average, a cup of coffee costs $2.70. If you drink one cup every day, that is around $985 a year. Most people will drink more than one cup of coffee a day.
On the other hand, renter’s insurance costs $179 on average, or $14.90 per month. (Figures come from 2018 data. Nevada’s average was $182. Contact A and H Insurance for a quote.) With this insignificant amount, you get $20,000 – $30,000 worth of coverage and plenty of peace of mind. By all standards, that is a great bargain and a very good reason to get renter’s insurance today.
Take action now; trouble doesn’t give prior warning before it happens!
