When you’re living in a rental property, many incidents can occur, including burglaries, injuries, fires, and severe storms. To protect yourself and your belongings from these types of incidents, you should purchase renters insurance because it benefits not only you, your property, and your landlord.
What Is Renters Insurance?
Renters insurance helps repair or replace your personal belongings — e.g., furniture, electronics, clothing, appliances, etc. — following a covered loss, which can include:
- Fire or lightning
- Wind or hail
- Falling objects
- Weight of ice, snow, or sleet
- Sudden and accidental discharge or overflow of water or steam
However, renters insurance doesn’t cover damage from floods or earthquakes. If you live in an area prone to these natural disasters, you must purchase separate policies to protect your personal property.
What Does Renters Insurance Cover?
Along with personal property protection, a typical renters insurance policy may also provide the following coverages:
- Additional personal property — This coverage helps protect highly valuable items, such as fine art, antiques, and jewelry.
- Personal liability protection — If you’re responsible for injuring someone or damaging their property, this coverage helps protect you financially.
- Guest medical protection — This coverage helps pay medical expenses for your guests who injure themselves on your rented property.
- Additional living expenses — If your rental property becomes uninhabitable due to a covered loss, this coverage helps reimburse you for living expenses you incur, such as hotel stay and meals.
Can a Landlord Require Renters Insurance?
Generally, the law doesn’t mandate tenants to get renters insurance to lease a property. However, landlords have the right to require you to purchase renters insurance in their lease agreement. Why? Landlords want to prevent lawsuits from tenants, and liability coverage on your renters insurance can help reduce litigation.
Oklahoma is the only state where landlords can’t require you to obtain renters insurance. Even if you live in the Sooner State or your landlord doesn’t mandate proof renters insurance, it’s still a good idea to get it, so you can protect your belongings and minimize your liability.
Benefits of Renters Insurance to Both You and the Landlord
Here are some benefits of renters insurance to both the tenant and landlord.
- Affordability — Renters insurance is fairly affordable. When you choose Mercury Insurance for renters insurance, you can protect your personal property and reduce liability for as little as $11 a month.
- Covers losses to personal property — Whether it’s clothes, electronics, or furniture, your personal property is safeguarded against covered perils. Even if you don’t own many possessions, you may realize replacing all your belongings by yourself adds up quickly.
- Provides liability protection — If someone gets hurt on the property you rent, your policy will provide liability coverage up to the limits you’ve selected.
- Additional living expenses — Your policy may include additional living expenses, which help cover costs, such as hotel accommodations and meals, if your rental unit or home becomes uninhabitable due to a covered loss.
- Protects your belongings when you travel — Your belongings don’t have to be at home to get protection. Whether they’re in your car or with you on vacation, your personal property is covered from theft, damage, and other perils.
- You’re not covered by your landlord — Tenants often believe their landlord’s insurance will cover them, but that’s not the case. Landlord insurance covers the building’s physical structure, while renters insurance protects your belongings inside the building.
- Screening potential tenants — Requiring renters insurance can help landlords find responsible tenants. Those who aren’t willing to pay for renters insurance or can’t afford it likely won’t pay rent in full or on time.
- Protects the tenant’s belongings — If a tenant’s belongings get damaged or stolen due to a covered loss, their renters insurance will provide coverage to repair or replace their personal property.
- Helps reduce litigation — If a tenant gets injured on the property, their renters insurance will handle both legal fees and medical bills, helping the landlord avoid a lawsuit.
- Minimize out-of-pocket costs — Filing claims typically raises the cost of insurance premiums. Requiring renters insurance for tenants can help landlords avoid filing liability or property damage claims, saving them money in the long run.
- Helps with temporary housing — If a disaster renders the rental property unlivable for a period of time, renters insurance can help provide the tenants with additional living expenses to pay for temporary housing until repairs are completed.
- Mitigates risk from pets — If someone gets injured due to a dog bite on the rental property, the compensation will come from the tenant’s renters insurance policy.
Additional Protection for Property Owners
While renters insurance can provide protection for landlords and property owners, they also need landlord insurance to further guard their assets and mitigate financial losses.
Landlord insurance is a policy that provides coverage for property owners and their rental properties. Since homeowners insurance is designed for owner-occupied homes, landlords typically can’t use homeowners insurance to protect their rental properties. However, landlord insurance is similar to homeowners insurance regarding coverage.
What Does Landlord Insurance Cover?
Here’s what a standard landlord insurance policy may cover:
- Dwelling coverage — This coverage helps financially protect the rental property’s physical structure if it’s damaged by a covered loss, such as a fire, windstorm, or accidental plumbing leaks.
- Personal property coverage — This coverage protects landlord-owned personal property, such as appliances and furniture.
- Premise liability protection — If a tenant injures themselves on the property and the landlord is held legally liable, this coverage helps pay for legal fees and medical expenses.
- Fair rental value — This coverage compensates landlords for lost wages if their property becomes uninhabitable and tenants are forced to evacuate.
Aside from a tenant’s belongings, landlord insurance also doesn’t cover regular maintenance or wear and tear on the property. It’s the landlord’s responsibility to maintain the property and ensure it’s up to code.
Whether you're a tenant or landlord, getting insurance can help give you peace of mind when a disaster or an accident happens. If you’re looking for best-in-class at an affordable rate, consider Mercury for renters or landlord insurance.