Renters Insurance

Renters insurance is the financial protection that one receives in the event of a loss or destruction of ones possessions while staying on rent.

Renters Insurance: Extent of Coverage

Renters insurance coverage includes the actual economic value of the goods or commodities belonging to the tenant and not the value of the building. Renters insurance also provides liability coverage for damage or injury to another person. Renters insurance covers for losses due to:

Explosion,
Lightning,
Smoke,
Fire,
Windstorm,
Damage caused by water (does not include floods),
Theft,
Hooliganism

Renters insurance also covers the expenses for temporary stay in another house, if one is unable to live in the rented house due to the above mentioned causes. It will usually cover the amount of money that is in excess of the normal expenditure within the limit of the sum insured.

Types of Renters Insurance:

Actual Cash Value: This policy pays for the damage after reducing the maintenance cost incurred on the possessions or dwelling place, up to a limit that falls within the sum insured.

Replacement Cost:This type of renters insurance pays for the damage without reducing the depreciation (maintenance) cost up to a limit mentioned in the policy.

Floater policy: One may want to insure belongings that are not insured by renters insurance. For this, one may opt for a floater. It is a separate policy that can be tagged along with the renters insurance policy for those goods or belongings (such as silver, furs and jewelry) not covered by renters insurance.

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