Generally speaking, your landlord’s insurance will cover repairs to the property, but not your belongings or the cost of living elsewhere if you have to leave during repairs. (Your landlord is only responsible to you if he was aware of unsafe conditions and didn’t fix them in a reasonable time frame.)
For roughly $300 a year, however, a basic renter’s insurance policy will cover about $50,000 in property damage.
You need renter’s insurance …
1. When There’s a Disaster
Renter’s insurance will cover property damage caused by fire, smoke, windstorms, lightning, explosions, electrical surges, snowstorms and certain kinds of water damage. It’s tempting to think you don’t have anything valuable enough to require insuring, but think about all the little things. How much would it cost to replace your dining room table? Your microwave? Your bed? Your work wardrobe? Your winter boots?
2. When Someone Breaks Into Your House
Standard renter’s insurance policies also cover your belongings in case of theft. When Beth Lacey Gill first bought renter’s insurance, she says, “I felt like it was wasted money.” But then, when someone broke into her house and stole her laptop, TiVo, camera equipment and jewelry, she says, “I was so lucky I had it.” Her insurance company covered a portion of the damage immediately and paid the remaining costs after she bought replacement items, including a new laptop with all the software it needed.
To make things easier on yourself down the road, take photos of any expensive items, like a TV or computer, to use later as evidence.
3. When Someone Vandalizes Your Place
Whether a burglar smashes things or an estranged lover breaks into your home and wrecks all your belongings, renter’s insurance will typically help you cover the cost of items damaged by vandalism.
4. When Someone Steals Your Stuff … Even Away From Home
Your belongings aren’t only protected in your home, but also if they get stolen outside the house. Krista Van Lewen had two expensive bikes and some stereo equipment stolen from a garage and a storage room in San Francisco. “I was thrilled to only have a $100 deductible in order to replace that [$1,500] bike,” she says.
5. When You Have to Stay Elsewhere While Your Home Is Being Fixed
Where are you supposed to go if your place is no longer livable during repairs? Renter’s insurance will generally cover your housing costs if your rental unit is damaged and you have to live elsewhere in the meantime.
In 2007, Barbara Adolph was renting a cabin that was struck by a fast-moving forest fire in Idaho. “My place did not burn, but I was evacuated for days and had lots of smoke and soot damage,” she says. “Renter’s insurance was great and paid for my out-of-pocket expenses and to clean my place.”
6. When Someone Hurts Himself at Your House
Renter’s insurance can cover your legal liability, as well. If someone gets injured at your home, your policy will likely cover the claimant’s medical expenses and costs from any resulting lawsuits. Generally, renter’s insurance will cover your legal expenses and any court reward up to $100,000.
7. When You Damage Someone Else’s Property
The liability protection doesn’t end with what happens in your home. Your policy covers you if you damage other people’s property—like, for example, if you break a neighbor’s window while playing baseball in the street.