What Does Renters Insurance Cover?
Thinking about purchasing renters insurance, but not clear on what it does and does not cover? Here’s the answer:
What’s Is Covered
Renters insurance typically covers loss or damaged caused by:
- Windstorm or hail
- Falling objects
- Weight of snow, ice or sleet
- Water (caused by plumbing failure, appliance failure, fire sprinklers or other accidental discharges of water)
- Electrical surges
It also covers:
- Injuries that others sustain while at your home (including medical expenses and any resulting lawsuits)
- Damage that you cause to other people’s property (ex: you break a neighbor’s window while playing ball)
- Housing costs. If your rental unit is damaged and you need to live elsewhere while it’s being repaired, your renters insurance will pay for your additional living expenses
What Your Insurance Will Pay to Replace:
Your renters insurance policy will pay to replace any property that is stolen, damaged or destroyed by a covered cause. This includes, but is not limited to:
- Sports equipment
Renter’s insurance protects your belongings even when you’re away from home. So, if your laptop gets stolen from your car or your bike gets taken from the rack at work, your renters insurance will pay to replace them.
What Isn’t Covered
Renter’s insurance does not typically cover loss or damage caused by:
- Floods (including sewer line and drain back ups and any water that seeps up from the floor)
Also Keep in Mind: If you live in an area prone to either hurricanes or tornadoes, your renters insurance may not cover damage resulting from such storms.
Additional Coverage Options
Need more protection that a basic renters insurance policy provides? You can add additional riders for:
- High Value Item Coverage – a good idea if you own jewelry, antiques, collectibles or firearms with a total value that exceeds your policy’s maximum pay out for such items
- Hurricane, Tornado, Earthquake or Flood Coverage – a must-have if you live in an area prone to such weather conditions
- Sewer and Drain Back Up Coverage – back ups happen more often than you would think, and they cause a lot of damage when they do
- Replacement Value Coverage – If you make a claim, you’ll be reimbursed for the full replacement cost of your items – rather than the depreciated cash value of your items
- Home Business Coverage – Most insurance policies offer very little coverage for business equipment. If you work from home, consider adding a home business rider to boost your equipment and liability coverage
- Business Merchandise Coverage – If you store your business’ inventory at home, an additional rider will be needed to insure it properly
Ready to start shopping for renters insurance? Refer to the American Insurance Association website for a list of reputable insurance companies, or check with the Better Business Bureau for recommendations specific to your area. (with "American Insurance Association website" linked to: http://www.aiadc.org/aiapub/ and "Better Business Bureau" linked to: http://www.bbb.org/)
Steve Wyrostek – RentersInsurance.org Expert
A 20 year plus veteran of the insurance industry, Steve managed departments in the personal and commercial lines areas of major insurers. He’s familiar with how insurance—ranging from boat to workers compensation—works.