Many tenants assume their property is covered under the landlord’s insurance policy.
However, when catastrophe strikes, they may be left with little or no recourse to recover, since their landlord’s policy covers the building or home they rent, but not the personal property stored inside. Renters insurance provides financial reimbursement to cover the tenant’s lost or damaged goods — under some circumstances — as well as liability in the event that a visitor is injured on the premises.
So, when it comes to catastrophes and natural disasters, what exactly will a renters insurance policy cover? Let’s take a closer look:
Yes. Renters insurance includes fire coverage. It will help reimburse you for damage caused by both flames and smoke. The compensation you will receive, however, depends on the amount of coverage you purchase, your deductible, and whether you choose cash value (depreciated) coverage or replacement cost coverage for your belongings.
Although huge wildfires like those in western states cause billions in damage and make national news headlines, more people are affected by smaller, single-structure fires. In fact, according to the National Fire Safety Council, people experience a home fire on average once every five years. That statistic may seem frightening, but most home fires are not catastrophic.
No. A traditional renters insurance policy excludes damage caused by earthquakes.
Earthquake renters insurance is separate coverage in high-risk areas. Tenants may be able to add renters earthquake coverage as a rider to your policy if they live in an affected area, or they may have to purchase a separate catastrophic insurance policy.
Yes. Most renters insurance policies include coverage for wind damage, so tornado policies don’t have to be bought separately. Also, in states where a natural disaster has been declared by the president, the uninsured or underinsured can receive federal aid, but that is capped at just over $30,000 (and a typical payment is likely to be much less).
Last year, tornadoes and severe thunderstorms were the number 1 cause of insured losses from natural catastrophes in the U.S.
No. Unfortunately, renters insurance policies typically exclude bug infestations of any kind, including bed bugs, cockroaches and other bugs as well as rodent infestations. You most likely are also not covered for any damage these pests cause, or for the costs to eliminate an infestation problem.
If you’ve ever dealt with a bed bug infestation, you know recovery is time-consuming.
However, as a renter, keep in mind that some states have specific laws about landlord and tenant responsibilities when it comes to bed bugs. Generally, it’s wise to tell your landlord about the infestation right away. Because they own the property, they are probably responsible for having a qualified exterminator inspect the home or unit.
While the costs to replace anything infested or damaged by pests is yours, the inspection should be the landlord’s responsibility.
Yes and no. Damage caused by hurricanes is less cut-and-dried than with other types of catastrophes. While most renters insurance policies do cover wind damage, some companies in coastal areas affected by hurricanes exclude this from standard coverage. One policy may cover wind damage caused by hurricanes, and another may require you to purchase an additional rider or hurricane renters insurance.
Hurricanes can also cause water damage. If the water is falling from the sky during the hurricane and causes damage, your renters insurance will most likely cover it. On the other hand, if the water damage is caused by flooding due to the hurricane, it will most likely be excluded from standard renters insurance.
Which brings us to…
No. Even if a hurricane was not the cause of a flood, a basic renters insurance policy will not cover this type of catastrophe. In fact, no standard insurance policy will cover flood damage.
Flood insurance isn’t federally required in moderate- to low-risk areas, but it’s still a good idea. In fact, people in these areas file more than 20% of all NFIP flood insurance claims. Most condo owners and renters in moderate-to low-risk areas can obtain coverage at a reduced rate.
The cost of renters insurance is generally quite affordable. You can typically expect to pay between $100 and $250 per year on average, depending on where you live and the coverage amount you carry on the insurance policy. The national average for renters insurance is $15 to $30 per month.
To learn more about renters insurance, please contact us at 845-986-1177. We are your business, home, auto, and life insurance solutions provider, partner, and adviser, serving Warwick, Greenwood Lake, Florida, Goshen, Pine Island, Middletown, Chester, Monroe, Newburgh, Orange County, and the Hudson Valley and Tri-State Area.