Many uninsured renters are under the mistaken impression that their landlord’s policy covers their possessions. A landlord does not provide insurance for a tenants personal property. An exception to this can occur if the landlord was aware of a prior hazardous condition, failed to correct it in a reasonable time frame, and as a result your property was damaged.
If you are a renter residing in New York, by law the building owner is required to maintain insurance on the dwelling you rent. This means that the building itself is insured, and should something happen to this structure as the result of fire, water damage, etc, the building owner is entitled to file a claim. However, the landlord's insurance does not protect you as a renter. If this same fire or water damage should ruin your sofa, clothes or other personal items, you are not protected against the loss of these items unless you buy a renters insurance policy. Moreover, if someone becomes injured while on the premises you rent, you could potentially be held liable for any medical and hospital expenses.
To protect yourself and your belongings, renters should consider purchasing renters insurance, also known as "tenants insurance."
What is Renter's Insurance?
Renters insurance, also known as tenants insurance, is a type of policy offered by most major New York insurers. These policies provide contents coverage and liability protection in the event someone becomes injured at your residence.
Renter’s insurance is generally less expensive than many people realize: a basic policy costs about $300 a year for around $50,000 worth of property protection.
Coverage generally provided under a Renter's Policy includes:
- Personal Property
- Loss of Use
- Personal Liability
- Medical Payments to Others
Renter's insurance typically covers loss or damaged caused by:
- Windstorm or hail
- Falling objects
- Weight of snow, ice or sleet
- Water (plumbing failure, appliance failure, fire sprinklers or other accidental discharges of water)
- Electrical surges
It also may cover:
- injuries that others sustain while at your home (including medical expenses and any resulting lawsuits)
- damage that you may cause to other people's property
- living Expenses. If your rental unit is damaged and you need to live elsewhere during repair
Your renter's insurance policy will generally pay to replace any property that is stolen, damaged or destroyed by a covered cause, subject to any policy limits or exclusions. This includes, but is not limited to:
- sports equipment
- jewelry (limited)
- collectibles (limited)
Important Note: Renters insurance often protects your belongings even when you're away from home. So, if your laptop is stolen from your car or your bike gets taken from the rack at work, your renters insurance may pay to replace them.
Consider whether you may need more protection than the basic renters insurance policy provides. Coverage you may be able to add includes:
- high value items - a good idea if you own jewelry, artwork, antiques, collectibles or firearms with a total value that exceeds your policy's maximum pay out for such items.
- a must-have if you live in an area prone to such conditions. a standard renters insurance policy does not include coverage for a flood or earthquake.
- sewer and drain back-ups - back-ups happen more often than you would think, and they cause a lot of damage when they do.
- replacement value coverage - if you make a claim, you'll be reimbursed for the full replacement cost of your items - rather than the depreciated cash value of your items.
- home business and business merchandise coverage - if you work from home, or store business inventory at home, consider adding a home business rider to boost your equipment and liability coverage. most policies offer very little coverage for business equipment or inventory.
Things to Remember
Before purchasing a renters policy, conduct a complete inventory of all your personal belongings, taking photos or a video of things like furniture, jewelry and expensive electronics items. Calculate the replacement costs for these items and double check with your insurance agent to make certain you are fully protected against any type of loss.
Choose the coverage according to your property. If you have a lot of electronics, choosing a policy that provides replacement cost coverage instead of actual cash value coverage might be the best option for you.
Like they do for homeowners, most insurance companies offer discounts to a rental policyholder to lower the cost of premiums. They may offer discounts for smoke detectors, dead bolts, etc.
Make sure that the policy has liability coverage. The best renters insurance policies will also include liability coverage for medical and legal costs if someone gets hurt in your residence.
The best renters insurance policies will also include emergency living expenses. This means that if you have to vacate the property due to damage, the insurance company will pay for you to live somewhere else.
A condominium association typically will have insurance that covers the building structure and common areas, such as corridors.
Separately purchased condominium insurance covers the unit-owner and is similar to renters insurance. Coverage typically includes interior damage to the unit, personal property and improvements. Loss of use is generally limited to 40 percent of the contents limit.
Loss Assessment Coverage can be an important policy provision. It covers certain assessments the condominium association may make due to a covered loss, such as fire affecting a common area. Carefully analyze the type of insurance your association has and how it might affect you in the event of a loss.