What does a renters insurance cover
Personal property
This is mostly what you’re paying for. Renters insurance protects your personal property — electronics, clothing, equipment, and other valuable items.
Before buying a policy you’ll take an inventory of what you own and determine what it costs to replace. This approximate amount will be your coverage limit.
You may have the option to select “replacement-cost” coverage or “cash-value” coverage (the cash value of your belongings). Replacement-cost means a bigger payout if your items are damaged or destroyed, so the policy is nominally more expensive — $20 to $50 a year more.
Cars aren’t included in the policy since they’re covered under your auto insurance. Objects stolen from your car will be covered, though, even if the car’s not on your property at the time.
Personal liability
This coverage kicks in if someone’s injured on your property, much like homeowners coverage. It also protects you from a landlord’s lawsuit if you cause accidental damages to the building.
Medical payments and additional living expenses
Both homeowners and renters get this coverage.
In next blogpost, we will discuss what are not covered by homeowners insurance and renters insurance.