Renters insurance protects your personal property which is not protected by a condo association or your landlord, while renters and homeowners face similar risks. Reports establish that only 37 percent of renters have renters insurance. Renters insurance premiums are different depending on where you live.
Renters should be aware that that owner’s insurance policy is typically not written to cover any losses to the renter’s property if it is damaged or destroyed. There are rental policies that required renters to insure their property.
The landlord and the homeowner have similar risks. There is a definite advantage to the landowner if renters protect their property such as:
* To protect the landlord from renter’s who sue the landlord for any property damage claiming the landlord has responsibility.
* If the tenant claims it cannot afford insurance the landlord has the opportunity to not to rent to a tenant that presents a risk.
* The Landlord shifts the risk to the tenant to reduce its responsibility.
* Tenant damages to the apartment will cover the landlord’s deductible on its policy.
* If the tenant is a business renter the tenant’s business is protected by its commercial business policy and not by the landlord’s policy.
The major difference between a landlord/homeowner and renters policy is cost. Renter’s insurance cost less than homeowners unless the renter is a business covered by its commercial policy.
The landlord/homeowner’s policy covers structure while renter’s policy mainly covers personal property. However, both policies are similar in determining loss either based upon actual cash value or replacement value. There exclusions that may not cover unusual personal property or environmental threats. It is clear that as a renter you lose autonomy. Some insurers will exclude certain types of animals or breed of dogs.
