What Does Renter’s Insurance Cover?

While renter’s insurance is not nearly as popular as homeowner’s insurance, it tends to be just as useful.

Renter’s insurance protects most of a renter’s personal possessions in case of a covered disaster or emergency. Also known as HO-4 or HO4 insurance, renter’s insurance does not cover a specific list of personal items in most cases. Instead, it covers practically all of your personal belongings if lost, damaged or destroyed due to any of 16 different insured disaster categories. While many of these insured disasters may be obvious, like damage due to a fire, many other covered situations may surprise you. If you are considering buying renter’s insurance, it is important to understand how renter’s insurance policies work and what types of disasters are covered. Read on for more information about renter’s insurance, the situations it typically covers and how you can quickly and easily submit a claim.

How does renter’s insurance work?

Renter’s insurance will usually cover most personal possessions that have been lost or damaged due to a covered event after you file a claim explaining what happened. Some policies request that you submit a list of items that you intend to insure when you buy the renter’s insurance policy, but many do not ask for any list unless you are filing a claim for loss of multiple personal belongings. Policies that are more comprehensive include liability coverage, which protects the policyholder from being sued, if someone were to get hurt on the rental property under the tenant’s name. Some renter’s insurance policies even include additional living expenses (ALE) coverage, providing the policyholder with the funds needed to cover temporary living costs if the tenant’s rental home is unlivable due to an insured cause. In addition, tenants can ask to add additional riders to their renter’s insurance that specifically cover any high value personal possessions.

Renters shopping for insurance will most likely choose from actual cash value (ACV) plans and replacement cost plans. In the case of loss or damage to a covered personal possession with an ACV plan, the tenant would receive the current cash value of the item at the time of the incident. With this plan, do not expect to be able to repurchase all of your previous possessions brand new and at full price with your insurance payout. Replacement cost plans tend to have higher annual premiums but, when personal possessions are lost or damaged, this type of renter’s insurance plan provides payment at the price of that item or the equivalent at current rates. If you are worried about having to replace expensive items if catastrophe were to strike, replacement cost plans are probably the better option for you.

What types of disasters renter’s insurance covers insurance?

Not every disaster is alike, at least from the point of view of insurance providers. As such, not every disaster is eligible for coverage under your rental insurance policy. Renter’s insurance HO4 policies typically cover at least 16 types of disasters that could personally affect you and your family’s personal belongings, including damage or loss due to:

  1. Theft
  2. Vandalism or malicious mischief
  3. Fire or smoke
  4. Wind or hail
  5. Lightening
  6. Weight of ice, snow or sleet
  7. Volcanic eruption
  8. Damage caused by vehicles
  9. Falling objects
  10. Explosion
  11. Riot or civil commotion
  12. Damage caused by aircraft or other vehicles
  13. Accidental overflow of water from a heating, cooling, a household appliance, plumbing, air conditioning or automatic fire-protective sprinkler system
  14. Freezing of a plumbing, heating, air conditioning, household appliance or fire-protective sprinkler system
  15. Unexpected and accidental damage from artificially generated electrical current (electrical surge)
  16. Sudden cracking, bulging or burning of a hot water heating system, an air conditioning or automatic fire-protective system

In what types of situations will you be covered by renter’s insurance?

As already mentioned, most of a typical person’s personal possessions are covered by a decent renter’s insurance plan. While most people recognize that this coverage applies to their personal belongings, many people do not know that this coverage also extends to several other types of covered situations that result in the loss of personal belongings due to an insured disaster. For instance, most renter’s insurance policies will provide coverage for your possessions even when they are outside of your home. If your phone is lost or stolen while out on the town, you could submit a claim for payment to your renter’s insurance provider for a replacement.

Another aspect of most renter’s insurance policies is liability coverage for personal property and injury. With this feature, your renter’s insurance policy will cover the cost of your friend friend’s phone that you accidentally dropped in the toilet, for example. For example, if your children accidently cause damage to items for sale in a retail store, your liability protection should cover the cost. Along the same lines, general liability coverage also protects you from being sued by someone that is hurt accidently on your rental property or due to something, you own or have legal responsibility for. Renter’s insurance policyholders are also often covered, if an accident caused by you or something in your apartment damages another home or the personal items of its inhabitant. If water from an overflowing toilet seeps through the floor into the apartment beneath yours, for instance, most renter’s insurance policies will cover the damage both to your home and to the home beneath yours. Renter’s insurance plans with comprehensive liability coverage are the best options for people looking to extend coverage as far as possible.

What renter’s insurance will not cover?

Some situations are specifically not covered in most renter’s insurance plans. Many renter’s insurance policies, for instance, differentiate between damage done by you and that done by someone else in your rented home. If a neighbor’s water pipes burst and ruin your personal belongings, your renter’s insurance may not cover the cost. If the neighbor has renter’s insurance, it should cover your costs. Storage units are another gray area. Some renter’s insurance policies cover your personal possessions when in a rented storage unit, while others defer coverage to whatever agreement you have with the storage provider. Renter’s insurance does not cover damage to your personal vehicle either, but most will include coverage for damaged or lost personal items that were in your vehicle. In addition, very few renter’s insurance policies cover damage caused by bug or rodent infestations of any kind or the cost to eradicate a pest infestation from a property. Along the same lines, most renter’s insurance policies do not include coverage for medical injuries caused by certain pets, particularly animals deemed high risk such as pit bulls. Like with homeowner’s insurance, coverage for damage due to flooding is not included in the typical renter’s insurance plan.

How do you file a claim?

While the exact claim submission processes for renter’s insurance policies will vary by insurance provider, in most cases it is a relatively straightforward process. Many insurance providers allow you to submit claim information online, making the process as seamless as possible. To file a claim, policyholders will usually need to show a receipt or some other proof of purchase for the items they are claiming for repayment. When several personal possessions are included in the claim or you simply do not have the required proof of purchase, a videotape of your home and your belongings can be used as proof in most cases. If possible, you should try to keep a list of the purchase price and date of your most expensive belongings in a safe place to avoid having to haggle over prices if you were to lose the items due to a covered disaster.

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