One of the benefits of renting is that your landlord, not you, is responsible for insuring and repairing the building. However, as a tenant, you are not entirely free of responsibility. Your landlord’s insurance will not cover the cost of replacing your items if a storm damages the building or a criminal breaks into your unit. If you want a financial safety net for these and other issues, you’ll need renters insurance.
What is renters insurance?
Renters insurance protects your personal items in the event of theft, fire, or other disasters. It can also cover your legal expenses if you are sued.
Renters insurance, also known as tenants insurance or a HO-4 policy, is comparable to homeowners insurance but is specifically created for persons who do not own their own home. Renters insurance costs an average of $148 per year, or about $12 per month, according to ReliableInsurance rate research. Renters insurance is significantly less expensive than homeowners insurance because it only covers the contents of your property, not the building.
Some landlords require tenants to get renter’s insurance before signing a lease.
What does renters insurance cover?
A normal renters policy provides four categories of coverage.
| Type of coverage | What it does |
| Personal property | Covers your clothing, furniture, electronics and other belongings. |
| Loss of use | Pays for hotel stays, restaurant meals or other expenses if you have to live elsewhere while your home undergoes covered repairs. |
| Liability | Pays out if you’re responsible for injuries to other people or damage to their property. |
| Medical payments | Covers injuries to other people in your home, regardless of fault. |
Personal property
Most renters insurance reimburses you for the loss of stuff such as clothing, smartphones, and other personal belongings caused by the following particular events:
- Fire or lightning.
- Windstorm or hail storm.
- Theft.
- Smoke.
- Vandalism or malicious mischief.
- Explosion.
- Volcanic eruption.
- A falling object.
- The weight of ice, snow, or sleet.
- Riot or civil unrest.
- Accidental release of water or steam from some household systems or appliances.
- Certain household systems are suddenly and accidentally ripped apart, cracked, burned, or bulged.
- Some household systems or appliances may freeze.
- Artificially generated electrical currents cause sudden and unintended injury.
- Damage caused by vehicles or airplanes.
Your personal items are insured both at home and when you are away. So, if someone takes your bike outside a store, your renters insurance coverage will protect you—with a few exceptions. First, your deductible will apply. Second, there may be a restriction to the amount of coverage you have outside of your house, which is normally 10% of your overall personal property limit.
Example: Lightning strikes your apartment building, igniting a fire that spreads throughout your living room. Your renters policy will cover damaged belongings, such as your couch and television, minus your deductible.
Loss of use, or additional living expenses
If you are unable to reside in your home due to a disaster covered by your policy, renters insurance will typically pay for you to stay somewhere while repairs are being completed. It can cover expenses like hotel bills, restaurant meals, and other fees that exceed what you would regularly pay.
Example: After a fire in your living room, you may need to move out for a few weeks while your flat is cleaned and repaired. Your insurance provider may be able to cover the cost of your motel stay. It can also cover the difference in expense between cooking your own meals at home and eating out every night (like you do at the motel).
Liability Insurance
If someone is injured in your rental and sues you, it might ruin your finances for years. The liability element of your renters insurance policy protects you in these situations by paying for someone else’s bodily injury on or off your property. (One exception: if you harm someone in a car accident, your auto insurance will cover the costs.)
Renters liability insurance also covers any accidental damage you and your family cause to other people’s belongings.
If your dog bites someone, your renters insurance may cover the damages. However, some insurers refuse to pay for dog bites or cover specific breeds. If you own a dog, check with your agent to ensure you are insured.
Renters insurance often covers legal representation in a case as well as monetary damages awarded to the opposite party. Renters insurance might also cover the cost if someone makes a liability claim against your coverage.
Example: You begin filling your tub for a bath but are interrupted by a dispute between your children. Your tub has flooded by the time you get everything in order. The water seeps through the ceiling and ruins the leather sofa in the apartment below. Your downstairs neighbor is suing you. Your renters coverage may cover both your legal fees and the $2,000 granted to your neighbor for the loss of her couch.
Medical payments
Like liability insurance, this coverage compensates if someone is injured on your premises. What is the difference? Medical payments coverage covers regardless of who is at blame for the injury, whereas liability insurance only pays if you are found responsible. Liability coverage typically has far greater limitations.
Example: A visiting friend trips over your son’s toy truck and lands on her wrist. It’s merely a sprain, but your medical payments plan will pay for her X-ray and urgent care visit.
Optional renters insurance coverage
In addition to the standard coverage stated above, you can normally pay a small fee to customize your policy with endorsements that provide additional coverage. Here are some of the most prevalent.
Replacement cost coverage
A regular renters coverage pays to replace your items at their real cash worth. That means that if your wrecked sofa is ten years old, your claim check will most likely only cover the cost of a secondhand sofa. You would have to pay the difference if you wanted a replacement.
Replacement cost coverage reimburses you for the expense of replacing lost products with new ones.
Scheduled Personal Property
Renters insurance often limits the amount they will pay for valuable items such as jewelry, weapons, and electronics, particularly in the event of theft. To acquire coverage for objects worth more than this maximum, consider adding a scheduled personal property endorsement.
Say you inherited a diamond ring from your grandmother. Before providing coverage, your insurance provider may need you to have the ring properly evaluated, which often entails taking it to a jeweler to determine its value. The insurer can then add separate coverage for the ring to your policy, for an additional fee.
The following is a list of goods that renters plans frequently cover only up to a certain level. The specific limits are listed in your policy or can be obtained from your agent.
| Electronics. | Firearms. |
| Furs. | Items used for business purposes. |
| Jewelry and watches. | Money, gold and coins. |
| Silverware, goldware and pewterware. | Watercraft and trailers. |
Water Backup Coverage
You may be able to add damage coverage if your sink, toilet, or other drain clogs, allowing water to flood your flat.
Pet Damage Liability
Whether your pet has a tendency to be destructive — imagine messes on the carpet or claw marks on the walls — you should check to see whether your insurer offers a pet damage endorsement. This can help with cleanup or repair charges, allowing you to keep your security deposit when you move out.
Identity theft coverage
Some insurance providers provide optional coverage for expenses related to identity theft. This may include credit monitoring services, legal fee coverage, and assistance with document replacement.Â
What renters insurance doesn’t cover
Every insurance policy contains exclusions, including renters insurance. The following are some things that renters insurance will not cover.
Flood damage
Most renters insurance policies do not cover flood damage, including significant rains or overflowing bodies of water. If your home is at risk, you must pay for repairs yourself or obtain separate flood insurance for renters.Â
One example is USAA, which covers flood insurance as standard in its renters policy. USAA renters insurance is exclusively accessible to active-duty military personnel, veterans, and their families.
Earthquake Damage
The majority of renters insurance coverage does not cover earthquakes. (USAA is an exception.) You can get earthquake insurance individually or as an addition to your renters policy.
Infestations
Most renters insurance policies do not cover bedbugs, mice, or other infestations.
Depending on where you live, an Assurant renters policy may provide coverage for bedbugs.
Another alternative is Jetty, which provides insurance only at participating properties but includes $300 in bedbug coverage in its base covers. If you live in a participating rental community, EPremium and eRenterPlan may offer bedbug remediation coverage as part of their renters plans.
Your roommate’s belongings
Most renters insurance policies will not cover your roommate’s belongings unless the two of you share a policy, which not all states or insurance providers permit. In most circumstances, it’s advisable to purchase your own renters policy.
Does renters insurance cover … ?
This table lists frequent problems and if your renters insurance policy will cover them.
| Problem | Covered? | Details |
| Broken windows | Maybe. | The liability section of your policy may pay if you accidentally break someone else’s window and they sue you. But if you break your own window, your renters policy won’t help you. |
| Car theft | It depends. | Auto insurance covers car theft as long as you have comprehensive coverage. But renters insurance covers personal belongings you have in the vehicle. |
| Dog bites | Usually. | The liability portion of your renters policy can pay for medical expenses or legal costs if your dog bites someone outside your household. However, some companies won’t insure certain breeds or dogs with a history of aggression. |
| Items in a storage unit | Usually. | Your renters policy typically covers items stored somewhere besides your home, often up to 10% of your personal property coverage limit. |
| Mold | Maybe. | If the mold develops after a sudden, catastrophic event like a burst pipe, your policy may cover it. But if the mold has been slowly developing because you haven’t gotten around to cleaning your basement, you’re out of luck. |
| Pet damage | Maybe. | If your dog breaks a valuable vase at a friend’s house, your liability insurance would cover the damage. But most renters policies won’t pay to clean up destruction your pet causes in your home. |
| Theft | Usually. | Renters insurance typically covers theft of your personal belongings, even from a location besides your home. |
| Water damage | Maybe. | If the cause of the water damage is a peril named in your policy, you should have coverage. For instance, damage from a burst pipe is generally covered, but damage from a flood usually isn’t. |
How much renters insurance do I need?
The amount of renters insurance you require is determined by how much stuff you own, how expensive it is, and how much your savings and other assets are worth. The more you stand to lose, the more insurance you require.
Before purchasing renters insurance, take inventory of your items to determine how much personal property coverage you need. Several home inventory apps are available to assist you list your belongings. This is also useful if you want to register a claim.
Liability limitations often range from $100,000 to $500,000. You’ll need at least enough to cover your current assets, such as savings and vehicles, which could be seized in a lawsuit.Â
