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What Is Renter’s Insurance? 

Renter’s insurance, or HO-4 policy insurance, is a policy that protects and covers your belongings, the contents of your rental, and you from damages and losses. Simply put, the policy protects your personal property when an accidental destructive event, or a covered peril, occurs. Additionally, if someone suffers an injury on your property, the insurance will protect you from being liable. 

There are two options to select from when choosing the right policy for you, actual cash value coverage or replacement cost value coverage. 

  • Actual Cash Value (ACV) Coverage: A cash reimbursement for the value of your items, taking into account the depreciation of the item. This coverage tends to have a lower premium. 
  • Replacement Cost Value (RCV) Coverage: The amount of money it would take to replace your items, at their market value, with the same or similar items. Premiums tend to be higher than ACV premiums. 

The Benefits of Renter’s Insurance

Woman shaking hands across a table Insurance for renters can help you manage any unforeseen issues, accidents, or problems. Knowing what to expect from your insurance claim will reduce your stress in any uncomfortable moments.

1. Your Landlord’s Insurance Policy Isn’t Enough

Oftentimes renters think that since their landlord has insurance, it also covers the tenants. This almost always isn’t the case. Landlord insurance is coverage for the building and structure. This includes houses, apartments, and condos. A tenant’s personal possessions getting damaged, or injuries that happen in the rental, are not covered. Nowadays, more and more landlords are requiring renters to have renter’s insurance before completing the lease agreement. 

2. It’s Affordable

Compared to home insurance, renter’s insurance is substantially cheaper. This is due to home insurance including the building structure in its coverage.  Each state is different, so be sure to look at your specific state to find what it will cost you. Consider cataloging your personal belongings and calculating their value, before you choose an insurance policy option. This will help you decide how much to spend on coverage.

3. Liability Coverage Is Included

In cases of accidental or unintentional events that cause damage to the rental or injury to an individual, renter’s insurance may cover the costs through liability coverage policy. This coverage would help pay legal or medical expenses, if you are found liable after a claim is made. It’s important to note that there is a liability coverage limit and to check with your provider.  

4. It Protects Personal Possessions Against Losses

Apartment for rent sign.

Your clothes, furniture, electronics, and other personal belongings are covered under renter’s insurance if a covered peril event occurs. Examples of peril events are accidental fires, hail or wind storms, theft, damages to plumbing systems, and more. The HO-4 insurance policy will reimburse you (up to the limit your provider has set) for the items damaged from the peril event. It’s important to bear in mind that you will have a deductible to pay before coverage kicks in. 

5. Additional Living Expenses May Be Covered

If your residence becomes damaged and unlivable, you’ll probably have to find a temporary living situation. This typically occurs in cases such as an accidental fire or bad malfunction of household appliances causing water damage. In these situations you may be forced to find somewhere else to live while your home is being repaired. If you have renter’s insurance your relocation expenses and food spending costs can be covered. 

Have Questions About Renter’s Insurance?

Want to learn more about renter’s insurance? The experts at Home & Auto Resources are to ready help and provide you with answers to your questions. Visit our website for more information!


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