Renters Insurance Provides Protection if You're Displaced from Your Home

Imagine coming home from a long day at work only to see that there was a fire in your apartment. Or you open your door and find your place flooded from a burst pipe. These are horrible circumstances that renters fear. If you rent, you can protect yourself with renters insurance coverage that will help pay for living expenses should your place become uninhabitable due to a covered disaster.

Renters Insurance is Affordable

It's surprising to note that only 43% of renters have renters insurance (Insurance Information Institute). Three common misperceptions contribute to the low participation rate for renters insurance: 1) many renters mistakenly believe that their landlord's homeowners policy will protect their belongings; 2) many renters feel they don't own enough property worth insuring (a myth easily dispelled by simply tabulating the cost to replace your furniture, clothing, electronics, CDs, DVDs, etc.) and 3) many renters think they can't afford renters insurance (according to the Insurance Information Institute, the average monthly cost of a renters insurance with $25,000 worth of property coverage and $100,000 worth of liability coverage only costs $16.26).

What Renters Insurance Covers

Renters insurance will protect your personal property from a variety of perils including fire, smoke, hail, snow, water discharge/pipe breakage, vandalism and theft. Renters insurance is primarily designed to protect your personal property should it become damaged, destroyed or stolen as a result of one of the aforementioned perils. Renters insurance policies also provide liability coverage should a guest sustain an injury in your home. However, what are you to do if a covered disaster renders your home unlivable?

Renters Insurance Loss of Use Coverage

Many renters insurance policies feature optional Loss of Use coverage. Loss of Use covers additional expenses such as hotel bills, restaurant charges and other living expenses you may incur if your home is rendered uninhabitable due to a covered peril. Loss of Use coverage limits are usually established as a percentage of your overall renter's insurance coverage limit, and are typically set at 20% of your policy.

A renters insurance policy can help you rebuild your life should your belongings be stolen, damaged or destroyed due to a covered loss. You have stuff worth protecting, and renters insurance is an affordable way to protect what you own.

The Loss of Use provision is an important policy feature to consider when buying a renters insurance policy. Should your home become temporarily unlivable due to a covered peril, it's comforting to know that the Loss of Use benefit will help you pay some of the additional expenses associated with being temporarily displaced from your home.