Will I need renters insurance if I rent a condo or house?

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Asked August 7, 2013

1 Answer

Renters insurance is one of several types of home insurance designed for people who do not own the buildings they live in. In addition to renters insurance, this type of coverage is available as condo insurance and coop coverage as well. These differ only slightly between them, and all three are stripped down versions of a standard homeowner's policy.

Renters insurance covers your personal belongings, any liability you have on the dwelling and property, and incidental coverage such as loss of use insurance. Condo insurance generally covers from the walls inward, meaning that you are responsible for everything from the surface of the drywall inward, but the building owner is responsible for the structure of the property and public access.

The basic cost of your renters insurance is based on the square footage of the dwelling, your credit score, your CLUE report, and any incidental personal information that influences your insurability. Additionally, you can increase the liability and personal property limits of the policy by adding riders, but each rider will cause a slight increase in your total premiums. If you decide to purchase Full Replacement coverage instead of the default Cash Value coverage, you are going to pay a bit more, but the difference is literally the difference between replacing your stolen stereo or receiving a check for only a small portion-- the depreciated value-- of what the stereo was worth.

Your renter's policy is not designed to provide coverage for the landlord, but to protect your property, both against things like weather and fire as well as legal and civil claims against you which arise from the property. Without insurance, a visitor who slips and breaks a bone can hold you personally responsible for paying the bills, and then sue you for more. Insurance handles the case for you, and eliminates most of the financial burden that could ensue.

Answered August 7, 2013 by Anonymous

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