Liability insurance and coverage for loss has always been a part of a landlord’s expenses. They simply must make sure to protect their financial investment. However, the property insurance is meant to allow the landlord to rebuilding or re-coop their losses from the destruction of the property. Many renters believe that this insurance will also cover their personal losses, including furniture, electronics and art. However, most renters are surprised to learn that their possessions are typically not covered.While renters insurance has been around for a while, most renters have believed it was simply an optional expense.
Landlords might have suggested that a renter purchase coverage, but there was typically no requirement. As insurance costs have risen, landlords now find themselves in a position to pass some of those costs onto their renters in the form of requiring them to carry renters insurance.
So what does one need to keep in mind when choosing a rental insurance policy? The first is to find out if the landlord requires renters insurance. If they do, then you need to have a list of their requirements. This requirement might be part of your lease. If it is, you will need to make sure that there are no gaps of coverage. It is also critical that you can produce a current insurance certification at any time for the landlord to avoid being in violation of your lease.
Once you know the requirements of your landlord, you will need to start shopping for renters insurance to meet those needs. However, there might be additional coverages that you want to add based on what you own or if you are self-employed and working from home. Floater insurance is available to cover those high priced items such as electronics or art.
Depending on your landlord, you may also be required to purchase a specific amount of liability insurance. This is one area where they can offset their own insurance requirements by passing the costs onto their tenants versus taking on a larger deductible. However, it is important to note that renters insurance requirements can vary from state to state. A landlord might not be able to require a tenant to carry renters or liability insurance in their lease depending on the state.
A standard renter’s insurance policy covers your possessions or personal property in case of a fire or destruction of the rental property. Generally, the landlord’s insurance covers the structure of the building, but the renter’s insurance cover property losses and often provides liability insurance for injuries not related to problems with the rental unit itself. If the unit is uninhabitable, there may also be funds provided to cover the costs of a temporary alternative arrangement. Earthquakes and flooding are not typically covered under most insurance policies. So if you live in an area prone to these type of natural occurrences, it might be worth exploring adding an additional policy rider to cover these possibilities.
Renters insurance has become one of the necessary expenses that comes with the renting culture
For renters, it is just one more item to budget for as you are determining how much rental space you can truly afford.