Renters insurance might be one of the most important purchases a person renting can make, but what does it cover? You’ve come to the right place.
One of the biggest perks of renting (rather than owning) is that the property is your landlord’s responsibility, not yours. Owning a property comes with a great deal of responsibility, such as handling repairs and regular maintenance, caring for the surrounding land, insuring the building, and more. As the tenant, you are completely off the hook!
However, it is important to know that your landlord’s insurance will not cover any of your personal belongings if disaster strikes or a thief breaks into your unit. For those wanting a financial safety net to protect themselves against these and countless other issues, renters insurance is a wise investment.
But what exactly is covered by insurance for rental houses and their occupants? Continue reading below to find out.
What is Renters Insurance?
Renters insurance, also called an HO-4 policy or tenants insurance, is insurance for renters and offers liability coverage while living in a structure that you are renting. Tenant insurance is similar to homeowners insurance in that it covers some of the same scenarios, like fire or theft.
However, these policies differ from homeowner policies because they only cover a renter’s belongings, not the building’s structure. Because of this, renters insurance is much more affordable.
While insurance for rental houses and their occupants is not legally required in Utah, many landlords or property lease companies require proof of renters insurance as part of the rental.
What Does Renters Insurance Cover?
A typical renters insurance policy offers four types of coverage:
1. Personal Property:
Personal property covers everything from clothing, electronics, jewelry, furniture, and other belongings.
Your personal belongings are protected by your policy when they are in your rental as well as when they are away from your unit. For example, if your bike were to be stolen outside of a store, on campus, or anywhere else, your tenants insurance will kick in once you’ve met your deductible.
Most policies will reimburse for the loss of these items in the event of:
- Fire and smoke damage
- Hail, snow, wind, and lightning storms
- Vandalism and riot or civil commotion
- Theft and malicious mischief
- Damage caused by aircraft or vehicles
- Explosions and volcanic eruptions
- Falling objects
- Accidental water leaks from various household appliances or systems
- Electrical current damage
- and more.
Liability coverage pays out if you are found liable (aka, responsible) for injuries to other people or damage.
If someone is injured in the property you rent or is injured by you elsewhere and sues you, a lawsuit could destroy your financial situation. The liability portion of your HO-4 policy offers some protection in these events by paying for someone else’s injury on or off your rental property (outside of car accidents; your automobile insurance will handle those expenses). This usually covers legal representation in lawsuits and money awarded to the other party.
Liability insurance can also cover damage you (or one of your covered family members) accidentally do to another person’s belongings. It may also pay if your dog bites someone; however, some insurance companies won’t pay for bites or cover certain types of dog breeds. If you have a dog, make sure to check with your provider to ensure coverage.
For example, suppose you accidentally let your sink overflow, and the water seeps through your floor and into the ceiling of the rental unit below yours and ruins your neighbor’s TV. If the downstairs tenant sues you, this insurance for renters could cover your legal bills in addition to the money to replace your neighbor’s TV.
3. Loss of Use:
Loss of use covers restaurant meals, hotel stays, and other expenses if you cannot live in your rental due to a covered event.
If a covered disaster leaves your rental unit unlivable, your tenants insurance coverage typically will pay for you to live elsewhere while your unit is repaired. It can cover meals (even those at restaurants!), hotel bills, and any other costs above what you normally pay.
For example, if mold is found in your rental and you have to move out for a few weeks while your apartment undergoes mold remediation, your insurance provider can help cover your hotel stay. It can also cover the difference in expenses between making your own meals at home (like you would normally do) and having to eat out every night (what you’d have to do while living at a hotel).
4. Medical Payments:
This covers medical payments to individuals who were injured in your home, regardless of who is at fault.
Similar to liability insurance, this type of coverage pays if someone were to get hurt at your rental property. How are the two different? Well, medical payment coverage pays regardless of who is at fault for the injury. Liability insurance will only be paid if the court finds you liable.
What Doesn’t Renters Insurance Cover?
Every insurance policy has its list of exclusions, and insurance for rental houses and their occupants is no different. Generally speaking, renters insurance will not cover floods, earthquakes, infestations, your roommate’s belongings, and potentially more.
Need Renters Insurance? Contact Bear River Mutual Insurance Today!
If you are in the market for renters insurance or another type of insurance, such as car, home, business, and more, the professionals at Bear River Mutual Insurance are here to help.
Protecting yourself as a tenant is just as important as protecting yourself as a homeowner or car owner, and our team is here to help you find the best rates and coverage to give you the peace of mind you deserve.
Insurance for renters is the best way for tenants to ensure a financial safety net. That’s why we are eager to help you find the perfect balance of protection and value for you and the things that matter most.
We proudly serve Provo, Orem, Salt Lake City, and countless surrounding cities in Northern Utah. Contact our team of professionals to get your free insurance quote today.