Does your renters insurance policy offer enough protection?
Renters insurance covers you, your liability, and your belongings in the event of a covered loss.
Below is a list of incidents typically covered — and not covered — by renters insurance policies. Renters insurance coverage is broken down into four coverage types: personal property coverage, personal liability, additional living expenses and medical payments insurance.
This article defines these coverage options, how much coverage they include, and what they cover.
|Covered by Renters Insurance||Not Covered by Renters Insurance|
|Fire and lightning||Ordinance of law|
|Wind and hailstorm||Earth movement|
|Explosion||Water (flood damage)|
|Riot or civil commotion||Damage caused by power failure|
|Vandalism or malicious mischief||Intentional loss|
|Falling object||Wear and tear|
|Weight of ice, snow, or sleet|
|Accidental discharge or overflow of water or steam*|
|Freezing of HVAC system|
*Damage from plumbing, heating, air conditioning, or automatic sprinkler system.
Renters insurance covers personal belongings up to a predetermined coverage limit. The amount of renters coverage is defined by the insurance policy and may total 10% of the policy's personal liability coverage. For example, a policy with $100,000 of liability coverage would include $10,000 of personal property coverage.
"Personal property" is a vague term. It can refer to clothing, furniture, art, electronics, or anything else owned in a rental house or apartment. This coverage may come with restrictions, called "special limits on liability."
Policy documents should detail these restrictions. Below are a few common restrictions.
|$200||Money, coins, gold|
|$1,500||Jewelry, watches, furs||Theft only|
|$1,500||Watercraft, trailers||Theft only|
On- and off-premises refers to the address listed on the policy. Renters insurance partially covers the insured party away from their rental property. Off-premises coverage typically only protects against theft.
While you can find a full list of exclusions here, the following items of personal property are excluded from coverage, regardless of the source of damage.
In the same way that personal property protects belongings, liability coverage protects you. If you cause bodily injury or damage someone’s personal property, liability coverage can cover the costs — including legal fees. Liability protection covers damages up to the liability policy limit, which is variable. A typical liability limit is $100,000. This coverage follows the insured party around the world at the same coverage amount.
This coverage pays for the medical expenses of an injured party — not the insured — if the injury occurs on the insured’s rental premises or as a result of the insured party’s actions.
Renters medical payment coverage includes:
The medical payments limit — which may vary — exists on a per-person basis. A typical limit is $1,000.
If the apartment or house you rent is deemed unlivable as a result of a covered loss, additional living expense coverage will cover the costs of residing elsewhere, up to the policy's coverage limits. Depending on the insurance provider, this coverage could be referred to as "loss of use."
The coverage options listed above are standard in many renters’ policies. However, optional coverage options are worth considering.
Most insurance companies have an option to upgrade reimbursement coverage from Actual Cash Value (ACV) to Replacement Cost. An ACV policy considers depreciation in reimbursement. Replacement cost pays the current market value of personal items. An ACV payout will usually be worth less than a replacement cost payout.
Individuals with expensive personal items.
Depending on location and insurance company, earthquake coverage is an optional addition to a renter's policy. If you live in an earthquake-prone location, speak to an insurance agent about adding this coverage.
Renters residing in earthquake-prone locations.
If your rental unit is damaged by a sewer backup, you likely will not have coverage without this option. This covers the damage caused by water from a sewer or drain. If a sump pump breaks and causes your living room to flood, this coverage would kick in and cover repairs to your personal possessions.
If you have an aging sewer system, live in a city with known pipeline issues, or have tree roots near your plumbing.
A rider — also known as a floater or endorsement — extends the special limits of liability on your personal items. If you have expensive items such as jewelry, coins, or art, consider this coverage. If you have valuable items, such as an engagement ring, add a scheduled endorsement to your policy. A scheduled endorsement requires an appraisal but is essential for high-value items.
Renters who own fine art, jewelry, firearms, or other valuables.
A handful of perils are not covered by renters insurance. Below are common exclusions and what you can do to get coverage.
If a law requires something in your apartment to be updated, your renters insurance will not cover the updates. For example, if you have an outdated electrical system that is damaged in an incident and a new city ordinance requires it be updated with different materials, your renters insurance policy would not cover the cost of these new materials or labor costs. While you can add this coverage to your policy with an endorsement, this is much more common if you're a homeowner.
This is a broad term for earthquakes, mudslides, sinkholes, and landslides. In order to have coverage for these events, you need to add supplementary coverage. Depending on your location, you may be able to add this coverage to your renters coverage. In some locations, you will need a separate earthquake insurance policy.
While your renters policy does cover some water damage, damage caused by a severe weather event will not be covered by a renters policy. In order to get coverage for flash floods or hurricanes, you need to add a National Flood Insurance Policy via the federal government. Learn more here.
If you fail to take care of your apartment, your renters coverage will offer no protection. This can include bug infestations — such as cockroaches, bed bugs, and rats. In the eyes of an insurance company, it is your primarily responsible to take care of your apartment — not theirs.
Dogs are covered by renters insurance if they bite someone or damage their property — unless your company views the breed as "dangerous" or "vicious." The definition of a "vicious" dog varies but may include German Shepards, Rottweilers, Pit Bull mixes, and Doberman breeds. If your furry friend falls into this category, you can shop around for an insurance company that will cover you, exclude your dog from coverage, or purchase a supplemental policy specifically for your dog. Learn more about pets and renters insurance.
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