What does renters insurance cover?

When people think of insurance for their living space, home insurance coverage is often the first thing that comes to mind. However, homeowners aren’t the only ones who benefit from coverage. Anyone who rents their home is eligible in buying renters insurance, whether they live in an apartment, condo, traditional house, or any other living space.

What is renters insurance? Renters insurance offers essential coverage for people who do not own their homes. It covers various things, but the main aspects of a renters insurance policy are personal property damage, personal liability, medical payments, and additional living expenses.

What does renters insurance cover? While renters insurance covers a lot, it doesn’t cover everything. Read on to learn more about what it covers, then compare renters insurance rates with as many companies as possible to find the most affordable policy.

Read More: Top Renters Insurance Coverage: What You Need to Know

What Renters Insurance Covers

Unlike homeowners insurance, renters insurance coverage focuses more on your personal property and legal responsibilities than the property itself.

Here’s what renters insurance covers:

• Personal property damage: This covers your belongings in case they are damaged or stolen, including clothes, furniture, electronics, and jewelry.
• Personal liability: Liability insurance is essential to protect yourself from legal costs if someone is injured in your home. A standard renters insurance policy comes with $100,000 of liability.
• Medical payments. Aside from legal costs, you might also be responsible for medical expenses for injured guests, and your renters insurance will pay for those medical costs.
• Additional living expenses: If a covered event damages your home to the point it becomes unlivable, your insurance will cover your living expenses.

There are a few other things renters insurance covers, but these are the main four parts of your coverage. Renters insurance is less comprehensive than a homeowners policy but costs much less. Regardless of how much you save, it would be best to understand what your policy covers so you don’t run into any problems.

Personal Liability

While you’ll probably never need it, liability insurance covers you if someone sues you after an injury in your home. This includes lawsuits after someone trips in your home or your dog bites a guest. The average renters insurance policy comes with $100,000 of liability coverage.

Liability covers your legal fees, not the medical bills of the injured guest. Legal costs include attorney fees and damages you might need to pay a plaintiff. One thing to keep in mind is that insurance policies usually require you to use the attorney it chooses.

Medical Payments

Your renters insurance also covers the medical expenses of an injured guest. Unlike the liability portion of your renters insurance, your policy covers medical expenses after an injury, no matter who was at fault.

Eligible medical expenses include hospital stays, x-rays, surgeries, dental-care costs, and other health care necessities. The average renters insurance has up to $5,000 worth of medical payments, but you can usually choose more if you’d like more coverage.

This type of coverage only applies to guests. You, your family members, and other roommates who live on the property are not eligible for medical coverage through your renters insurance.

Additional Living Expenses

One of the most critical aspects of your renters insurance is the additional living expenses (ALE) portion. ALE covers you when your home becomes unlivable after a covered event.

Renters Insurance Limits

Although your renters insurance covers a lot, it does have limits. As stated earlier, the average renter has about $30,000 worth of belongings. If you have high-value possessions, you might need more coverage. If you own any of the following belongings, you might need to consider more coverage:

• Expensive collections, like stamps, coins, or porcelain
• Multiple electronics, like computers
• Exercise equipment for a home gym
• Jewelry and furs
• Firearms
• Silverware and goldware
• Sports equipment
• Musical instruments
• Watercraft and trailers

Having high-value items can dramatically increase the overall value of your possessions, so it’s essential to understand what you own. You should also let your insurance company know about any high-value items in your home.

How to Pick the Right Renters Insurance Policy

Buying renters insurance is usually straightforward, especially if you know how much coverage you need. To find the top renters insurance coverage, follow the simple tips below:

• Determine how much coverage you need. You saw above that you should make a basic inventory of your belongings so you know how much coverage you need, and doing so will help you choose the right amount of coverage.
• Pick what coverage you want. Some renters are better suited for a standard policy, while others should consider adding earthquake or flood coverage.
• Compare your options. Some companies offer cheaper or more comprehensive renters insurance, and you should research your options before deciding which company you buy renters insurance from.
• Compare quotes. Once you have a few choices for renters insurance, your final step is to compare policies. You’ll want to look for a policy with the right coverage that fits your budget.

After you know which company you want to buy renters insurance from, applying for a policy is usually straightforward. Most companies allow you to apply for a policy online. If that’s not an option at your preferred company, you can speak with a representative on the phone or in person at a local office.

Best Renters Insurance Companies

There are several options for renters insurance, including some of the most popular companies for other types of coverage on the market. When you need renters coverage, consider the following companies:

• Geico
• Allstate
• Farmers
• Progressive
• American Family
• Erie
• The Hartford
• MetLife
• Nationwide
• Liberty Mutual
• Lemonade
• USAA

While the companies listed above have solid reputations, you should still research them before signing up for a policy. For example, USAA’s renter insurance is only available to military members and their families.

Other companies considered good choices for car insurance might not be the best fit for your renters insurance. For example, Geico renters insurance is sold through a partnership with Liberty Mutual and Travelers. It might not sell its own renters insurance, but Geico does offer a discount on car insurance if you buy it.

How do you file a renters insurance claim?

Now that you know what rental insurance covers, you should also understand how to file a claim. Filing a renters insurance claim works similarly to any other type of coverage, and it’s essential to file a claim as soon as possible after a covered event causes damage to your home. Without making a claim, your insurance company won’t know you need help.

It would be best to inventory your possessions before filing a claim. This inventory should include anything you would want to use your insurance to replace if anything happened. Having an inventory will help you pick the right coverage and make it easier to remember what you need to replace.

After you have an inventory, follow these steps to file a renters insurance claim:

• Inform your landlord. While they probably won’t have anything to do with your claim, most leases require you to inform your landlord about such events. (For more information, read our “How can you get your landlord in trouble?“).
• File a police report. For cases that involve theft, vandalism, or other intentional damage to your belongings, you’ll need a police report for your insurance claim.
• Contact your insurance company. While you’ll still need to file a claim, letting your insurance company know that an incident has occurred can help the process resolve faster.
• Document the damage. Once everything is settled with the damaging event, document everything that was damaged. Having this information will make filing a claim much easier and faster.
• File the claim. Once you have all the necessary information, you can start a claim with your company. Most companies allow you to create a claim online, but you can also contact a representative by phone.

Filing a claim can take a long time, but getting your belongings replaced is worth it. Being as upfront as possible with the information in your claims will help it resolve faster. Also, please respond to any requests from a representative as soon as possible.

Case Studies: What does renters insurance cover?

Case Study 1: Theft and Vandalism

Sarah, a young professional living in a rented apartment, returned home one day to find her place had been broken into. Several valuable items, including electronics and jewelry, were stolen. Thanks to her renters insurance, Sarah was able to file a claim and receive reimbursement for the stolen items, minimizing her financial loss.

Case Study 2: Fire Damage

John and Maria, a couple renting a house, experienced a devastating fire caused by an electrical malfunction. The fire destroyed their furniture, appliances, and other personal belongings. Fortunately, their renters insurance policy covered the cost of replacing the damaged items, allowing them to rebuild their lives without bearing the entire financial burden.

Case Study 3: Water Damage

David, a student living in a rented apartment, woke up one morning to find his ceiling leaking due to a burst pipe in the unit above him. The water damaged his laptop, textbooks, and clothing. With his renters insurance, David was able to file a claim and receive compensation for the damaged belongings, enabling him to replace them quickly and continue his studies.

Case Study 4: Personal Liability

Amy, a renter, hosted a gathering at her apartment. Unfortunately, one of her guests slipped and fell, resulting in injuries. Amy was held legally responsible for the medical expenses and legal fees. Thankfully, her renters insurance covered the liability costs, protecting her from significant financial consequences.

Case Study 5: Natural Disasters

Mark, a renter living in a coastal area, experienced severe damage to his apartment due to a hurricane. The strong winds and flooding caused extensive destruction to his personal property. With his renters insurance policy, Mark was able to recover financially by receiving reimbursement for the damaged items and securing temporary housing during the rebuilding process.

The Bottom Line on What is Covered by Renters Insurance

With so many Americans relying on renting their homes, renters insurance is growing more and more popular. Whether renting an apartment, condo, or house, renters insurance offers valuable coverage for your personal belongings.

No matter what you have in your home, it would be best if you constantly research your options. Comparing as many quotes as possible is the best way to find the most affordable coverage.