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Renters insurance is most thought of in regards to a tenant’s personal property; however, there are many other areas of coverage which must be understood.
Renters insurance policies include coverage for personal belongings at home and a percentage of the same limit is covered away from home. Personal belongings away from home may include coverage in a storage unit, in a vehicle or lost during travel. It is important to read the details of coverage in the specific policy since there may be variances between States and there may also be endorsements on a policy causing a variation of the definitions of coverage.
Vehicles are generally not covered on a Homeowners Insurance or Renters Insurance Policy since vehicles are covered by Automobile Insurance Policies. The perils of Fire and Theft of vehicles would be covered under Comprehensive Coverage and damage by collision is covered under Collision Coverage; thus, Renters Insurance will not cover the theft of your vehicle.
The most valuable section of Renters Insurance is Personal Liability; this coverage affords protection and defense due to a case of negligence brought against the tenant; whether the negligence causes bodily injury or perhaps the negligence causes a fire damaging the property. Without this coverage, a law suit could be a life changing experience leaving the tenant with a lifetime of wage garnishments or a devastating bankruptcy. Renters Insurance policies automatically come with a minimum $100,000 Personal Liability coverage with no applicable deductible.
Renters Insurance policies also offer Additional Living Expenses coverage; if you are unable to stay at your home due to a covered peril, this coverage will pay any additional living expenses or relocation expenses up to the limit listed on the policy.
Covered perils on these policies usually include: Fire and Lightning, Windstorm or Hail, Explosions, Smoke, Vandalism, Theft, Burglary, Falling Objects, Weight of ice, Freezing and Volcanic Eruption.
The definition of Flood is often confused when used in reference to Homeowners or Renters Insurance policies; Water Damage due to rain, wind, broken pipes etc… is usually afforded coverage; however, Flood Damage from rising water from the exterior is explicitly excluded. Flood Insurance is available from the National Flood Insurance Program (division of FEMA).
