What is Renters Insurance?
Anyone renting in California should acquire the appropriate insurance coverage for their apartment or home. Many renters in California give up their renter’s insurance in order to save money, but sometimes this savings may cost them down the line. There are many reasons to obtain renters insurance (and not just for rented apartments but for rented homes too), and this article will give you some insight about renter’s insurance. It is HIGHLY recommended, whenever you are renting, to consult with your insurance agent about your options to regarding renter’s insurance.
What does your lease agreement require?
Before applying for renter’s insurance, it is important to check what is written in the lease agreement. Look for what is written in the contract on the question of responsibility: Who is responsible for what?
1. It is important for the tenant to know what they are responsible for and this can be found in the leasing agreement. Whether it’s a liability requirement, or a loss of use requirement – most, if not all tenant contracts require the tenant to return the unit in the condition it was originally rented in. This section may mean that any damage done to the apartment is the responsibility of the tenant. It is important to note that the tenant must compensate the owner of the apartment for heavy damage done to the apartment. It is important to make sure that the renter has enough liability coverage for what is required in the contract.
2. The landlord requires the tenant to insure what the tenant is renting. Often, the landlord will require renter’s insurance with a minimum liability requirement (usually $100,000 but may be more) meaning that the tenant has a responsibility to insure the apartment itself and cover any liability risks that arise while the renter is occupying the unit.
What does renter’s insurance cover?
The landlord is responsible for whatever is attached to the building. However, the tenant must take care of the following insurances that will save him financial damage and / or claims made against the renter.
Renters Insurance covers the tenant’s personal belongings as well including furniture, personal equipment, valuable items, electronics, etc. Loss of use coverage kicks in as a result from natural damages such as: earthquake, flood and loss of contents as a result of vandalism in the unit. The insurance policy restores the tenant’s condition and personal property to what it was before damage occurs. It is important to note that the landlord cannot insure the property of the tenant since he has no insurance relationship with him. In other words, renter’s insurance covers the renter’s personal belongings. The best way to explain personal property coverage in a renter’s policy is, if you take the apartment, turn it upside down, everything that falls is covered on the renter’s insurance policy.
Liability Insurance of the renter’s policy, which is included in every renter’s policy is very important since it covers the potential damage to the apartment structure caused by the renter’s negligence. For example – the tenant caused a fire due to his negligence in the kitchen. The property owner will be able to claim compensation from the tenant and the renter’s insurance policy will pay. The liability portion in the renter’s policy also covers guests who are injured while in the unit.
Workers Comp for Part Time Employees – This coverage is usually included in most renters’ policies. This section covers the renter for household employees if they are injured or damage the property. This coverage is for cleaning ladies, technicians, or workers in the unit. Make sure to let your agent know if there is a cleaning person, or other employees in the house so your agent can provide the appropriate policy to cover them as well.
