We’d like to tell you that in the next few hundred words, we’ll cover everything you need to know about renters insurance explained in a way that makes sense whether you have Bowie, MD Renters Insurance or live somewhere across the country.
While we can’t quite go that into depth, we can tell you that we’ll give you a high level overview that’s applicable in most states. We’ve seen attempts at this before, but renters insurance explained should include what it is, why it’s important, what it covers, why your landlord requires it, and how much it might cost you.
That’s a great deal of information, so let’s dive right in!
Renters Insurance Explained: What Renters Insurance Is
Explaining renters insurance is actually pretty straightforward and simple, from a high level view.
- Renters insurance pays to replace your property if it suffers loss or damage from a long list of covered perils.
- Renters insurance pays for bodily injury or property damage that your negligence causes to someone else.
- Renters insurance pays to defend you against liability claims for bodily injury or property damage that would be covered by the policy.
- Renters insurance is what stands between you and the landlord suing you if you have a kitchen fire, for example.
- Renters insurance pays for additional living expenses following a covered loss when you can’t use your apartment because of that loss.
- If you’re the one whose property suffers a loss from someone else’s negligence, you can make a claim on your policy, and your policy will seek reimbursement for the money they paid out from the responsible party’s policy. This sometimes can include your deductible.
- On the other hand, renters insurance is not a warranty on your electronics. “It just died” is not a covered cause of loss, of course.
Renters Insurance Explained: Why Renters Insurance Is Important
Once upon a time, it was explained to us that renters insurance is important because life happens. That is all too true. But the real problem is that wages haven’t kept up with the cost of living. Just because you could afford to buy a brand new couch ten years ago doesn’t mean you could necessarily afford to do so today. Certainly not without any warning, and certainly not when you had to replace everything else that you own.
Renters insurance is important because many Americans couldn’t come up with $400 to handle a crisis, much less any more than that. That means most people can’t afford to replace the things they own. Renters insurance generally pays the replacement cost of property that suffers a loss. That means you can go replace it, at the store, with something of like kind and quality.
Most people, after they have a claim for a theft or a fire, aren’t quite sure what they’re going to do about their property. They’re not even sure what they’ll do about a place to stay, if their apartment suffered a fire. The Red Cross will often be able to pay for a few nights in a hotel, but only a few. Renters insurance is important because it can pick up those additional living expenses.
If someone alleges that you caused them bodily injury or property damage, defending against that suit is crucial – especially if you’re not responsible for the loss, but even if you are. Remember that even a frivolous lawsuit can turn into a judgement that can follow you for a very long time. If you don’t defend against that frivolous suit, they can collect against your assets, your earnings, your future assets, your future earnings, even against overall household income in some situations. Renters insurance prevents this and offers a settlement or defends against the suit, even if it’s frivolous.
Renters Insurance Explained: What The Policy Covers
Explaining what your renters insurance policy covers can be challenging, but here’s what it comes down to: Your personal property is protected against direct physical loss or damage caused by a covered peril. Wind may be excluded in certain coastal areas, but for most renters insurance policies, this is a complete list of the things your property is protected against:
- Fire or Lightning
- Windstorm or Hail (see above)
- Riot or Civil Commotion
- Vehicles (Not Your Own)
- Vandalism or Malicious Mischief
- Volcanic Eruption
- Falling Objects
- Weight of Ice, Snow, or Sleet
- Accidental Discharge or Overflow of Water or Steam (i.e., burst pipes)
- Sudden and Accidental Tearing Apart, Cracking, or Burning
- Freezing (You need to make a good faith effort to maintain the temperature, of course,but a power outage caused by a blizzard would mean there wasn’t much you could or should have done differently)
- Sudden and Accidental Damage From Artificially Generated Electric Current
Let’s touch on that last one for a moment. Sudden and accidental damage from artificially generated electric current excludes tubes, transistors, electronic components, etc. If, however, a power line goes down and sets your apartment on fire, that could be a covered loss. If there’s a sudden voltage surge and it causes your electronic device to catch on fire, that could be a covered loss. If there’s a surge that just damages the electronic device, that’s not generally covered.
So what’s covered on the liability side? An occurrence where your negligence causes someone else to suffer bodily injury or property damage. If you’re not as careful as you should be and you bump into a store display of china, that damage could be covered. If you cause someone to trip and fall, that could be covered. And defense kicks in where there is liability coverage.
One final word on explaining renters insurance coverage: Your policy is meant to cover things that are sudden and accidental. It’s not meant to cover damage from slow leaks, for example, and it won’t – you knew or should have known about it and could have mitigated the damages.
Renters Insurance Explained: Why Your Landlord Requires It
This is an easy one. Your landlord requires Bowie, MD Renters Insurance because he knows that some portion of tenants will damage the property through their negligence. A few people will have kitchen fires. Some people will overflow their bathtubs. You get the idea.
By requiring renters insurance, your landlord knows that when this happens, there’s a policy in force to take care of the loss. It means that neither the landlord nor the landlord’s insurance needs to sue a tenant individually, especially a tenant who can’t afford to mount a defense. The policy pays for the damages, and the rest is worked out between the insurance companies and their lawyers.
Requiring renters insurance makes for better landlord-tenant relationships and helps to ensure that the property comes back to them in the condition they leased it to you. Another benefit is that when renters insurance is required, the landlord has made it crystal clear that you are responsible for insuring your own property. Some people believe otherwise, even though the landlord couldn’t insure your stuff if he wanted to. He doesn’t want to, but he couldn’t because he has no interest in the condition of your property.
Renters Insurance Explained: Costs And Other Details
The national average price of renters insurance is just $187.00, according to the III. That works out to as little as fifteen dollars per month. The vast majority of families can budget renters insurance easily at those prices.
Additionally, it's important to note that renters are at a significantly higher risk of experiencing loss than homeowners. Renters occupy roughly one third of total housing stock in the country, and yet they are fully fifty percent more likely to experience theft than homeowners, according to the Bureau of Justice Statistics.
It only costs a few dollars a month to protect your family, and this cheap renters insurance is a great way to mitigate the additional risks that come with being a renter.
As far as getting a policy started, that’s the easiest part. All you have to do is click or call. The whole process is quick and easy, because Effective Coverage has streamlined it to make renters insurance accessible in line with our core values.
Effective Coverage offers the nation's only completely mobile platform to quote and purchase renters insurance right from your phone or tablet in just one minute. Get an online renters insurance quote today and protect your family.
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