Rental properties can be a little confusing when it comes to matters of property, rights, and ownership. With home insurance, the building and everything in it are typically owned by the same person. With rental property, you have at least two proprietors by default: The landlord and the tenant.
Renters insurance basically breaks down like this:
- The building is owned by the landlord. Insuring the building is the landlord's responsibility.
- Possessions found inside the building belong to the renter. Insuring these possessions is the renter's responsibility.
Some landlords may offer some basic coverage under their own policies. But, by and large, these policies will only cover the building and general liability.
Still, renters insurance extends beyond simply covering your possessions. Here are some other things you can expect to be covered under a typical renters insurance policy:
- Liability. It is not always clear whether an injury claim will fall to the landlord or the renter, so renters insurance will offer some coverage for the associated costs.
- Alternative arrangements. If your apartment building is being remodeled or if it is damaged in a fire, your renters insurance may pay for you to find somewhere else to stay in the meantime.
Many renters may assume that since the personal possessions they keep in the home barely cost more than the deductible to file a claim on them — and because the physical property itself is the landlord's responsibility — that they simply don't need to invest in an insurance policy. But as you can see, these policies offer protections well beyond simply covering your possessions. The costs associated with an injury in your apartment or being forced to find a new place to stay can be considerable. When that happens, it's good to know that your insurance provider has you covered.