Renters insurance is different from homeowners insurance. You can only insure property that you own, and you don't own the home you rent.Renters insurance policies can cover property you keep in the home, however. It also covers certain expenses that may arise if something happens to or in your home.
Renters Insurance Covers Certain Risks
Renters insurance covers losses caused by certain natural disasters such as fires and snowstorms. Most policies also cover losses that occur if someone robs or vandalizes your home. Covered losses typically include all personal property located in your home at the time the mishap occurred.
Many renters insurance policies also cover temporary living expenses if you have to move out of your home because of a disaster or mishap. They might also cover your medical expenses or the medical expenses of someone else injured on your property.
Renters Insurance Doesn't Cover All Risks
Few renters insurance policiescover losses due to major disasters such as earthquakes or hurricanes. If a major disaster takes place, the insurance company might go bankrupt trying to cover a large number of expensive claims. Your policy won't cover damages that were your fault. If you allow your children to play with matches, for example, the policy might not cover damages from any resulting fire..
Coverage Is Limited
Two important coverage limitations apply - deductibles and replacement value. A deductible is the amount of any loss that you must pay for out of your own pocket before insurance kicks in. The higher the deductible, the lower your monthly premiums will be. In addition, your policy will probably cover only the book value of any item you lost, not the actual cost of replacing it. For example, if you lost a used TV worth $400, you can't claim any more than $400, even if it costs $600 to buy a new one with similar features.
Some insurance companies will sell renters special coverage insurance policies that protect against risks that ordinary policies don't cover, such as hurricanes, earthquakes, and tornadoes.
You may also be able to buy coverage for personal belongings, like a laptop, that are stolen outside your home. You will have to pay a higher premium for special coverage, particularly in certain areas. Earthquake coverage, for example, is likely to be more expensive in California than in Pennsylvania.
A Lawyer Can Help
The law surrounding renter's insurance can be complicated, especially if a claim is denied. Plus, the facts of each case are unique. This article provides a brief, general introduction to the topic. For more detailed, specific information, please contact a real estate or an insurance lawyer.