Rental Insurance Components

Components of Rental Insurance Simplified

As renting becomes the route more people are going, more landlords are requiring tenants to have renter’s insurance. Contrary to most beliefs the landlord’s insurance will not cover the tenant. So if wind damages the roof, the landlord is responsible. But what about the $1300 sofa and $1500 entertainment center that was ruined by rain that leaked through the damaged roof? This is when renter’s insurance comes into play.

A renter’s insurance policy has the purpose of protecting the contents within your rented property. There are numerous components of the policy: personal property, medical expenses and liability exposures. It is also important to realize the perils that your coverage covers, such as fire, flood damage, tornado, and so on. As well as understanding your deductibles, which is the amount you pay out of pocket until the insurance starts picking up the bill.

Personal property is the component of your policy that protects the items in your home not permanently attached to the structure itself. This includes items such as furniture, clothing and household appliances such as a washer or refrigerator. It is vital to understand the ins and outs of what your personal property coverage entails. Most policies do not cover antiques, rare items, or outdated items. Therefore if you have any of these types of items it would be best to get additional coverage. It is also important to note that most insurance companies use a value of 40% as an estimate of the replacement cost of personal property. The amounts of personal property coverage vary. When purchasing a policy you need to take an inventory of your possessions. From there calculate just how much it would cost to replace these items if some unforeseen event occurred.

The medical expenses component of a rental policy covers those slips and falls incurred by your guests while they are in your home. If a friend slips in your kitchen and breaks their leg, you are legally responsible for their medical bills. All though the medical coverage will not heal your friendship, it will cover those medical expenses, so you have less out of pocket expense. The medical coverage will cover amounts up to a certain amount. Most companies offer $1000 per person.

Liability exposure works closely with the medical exposures component. The example mentioned beforehand is a great way of proving the value of liability exposure. After the accident the medical bills are covered, but the friend is still set on filing a lawsuit against you. Liability exposure will cover your lawyer expenses as well as any other damage occurred. This type of protection has a limit on just how much it will give you; the usual is $100,000 per accident.

Renters insurance had once been thought of as irrelevant or a waste of money. In today’s unpredictable times it is in your best interest to have the protection you need for yourself and your valuables.