Do you know details about what renters insurance will cover?
What Does A Renter’s Insurance Policy Cover?
Renter’s Insurance Policy will cover the personal items if they are damaged, destroyed or stolen due to natural disasters or other various reasons. In case of floods, fires and earthquakes, your personal items will be severely damaged or lost. The insurance will cover the losses from those house items up to the amount of what you are insured for. Also the following items can be covered:
- Personal liability in case you get
sued over accidental injury to others who are in your rental property
- Accidental damage to property of others in your care
- Living expenses when you are forced to live elsewhere while your rental property is being repaired
To the contrary of many people, it is not true that a landlord’s insurance will probably cover tenant’s property losses. In that case, there should be a enough proof that can show the landlord had neglected those accidents and not willing to recover from the damage promptly. Also if you look into more details, the landlord insurance policy is not intended for tenant’s favor, and there are limitation of coverage area. Most of landlords are already well aware of landlord obligation and duty surronding the rental property before signing a lease contract. So usually they ask a new tenants to show them a proof of renters insurance policy.
Is A Renter’s Insurance Policy Required?Renter’s insurance is not a mandatory requirement for all the tenants. But in some lease terms, there are statements that specifically require tenants to have insurance to cover some level of liabilities when someone gets injured on the property site which is not caused by landlords. In that case, landlord won’t want to be involved in the argument and liability issue. Even if tenants are always careful, they are not the only cause of damages. Mother nature or other tenants could be a source of all the problems later. So the best rule of thumb is that if you have anything valuable in your current rental property, you better get the insurance.
Also you may want to be aware that landlord has a legal right to ask a tenant to buy liability insurance before they sign on a new lease contract. Even for the case of month to month rental agreement, landlord can request to make a change on the agreement terms to include renters insurance policy.
The Obligations and Rights Of A Renter’s Insurance Policy
When the lease contract is signed finally and renter’s insurance policy is purchased, one of the company’s major jobs is to give a manageable defense in case there is a lawsuit. The insurance company will choose a defense lawyer and will have to approve all legal fees and other expense payments pertaining to the lawsuit. It can be due to tenant’s fault. However, the lawyer will only represent the policyholder. Under the majority of liability insurance policy, the company has the contractual right to defend or settle a lawsuit whenever they feel necessary. The policyholder does have a chance to give input but that doesn’t mean the company has to get the renter’s approval or consent.
According to the National Association of Insurance Commissioners, the average cost of a renters insurance policy per month is between $15-$30. If you still think it is too much, there are ways that you can reduce the cost, like installing home security alarm system and maintaining a good credit score.
For more information regarding legal issue and resources, go to our site, and you can download many free legal forms with PDF format, including rental forms and Lease Agreement that can be used for landlord and tenants as well.