No one wants to have an apartment robbed or their belongings lost in an unexpected tornado, but sometimes life happens. When the unexpected happens, everyone wants financial coverage and knows they have a backup plan or protection in place.
It’s there that Tenant insurance Although landlords have insurance policies covering the apartment complex and building in place, it is often up to tenants to provide their own tenants insurance when the policy covers personal effects. In fact, most landlords require proof of tenant insurance to rent their property before signing the lease.
We’ll help you understand the fundamentals of a basic tenant’s insurance policy and give you ideas on how to present proof of tenant’s insurance if your landlords require it.
What is a tenant’s insurance policy?
Simply put, insurance is protection against financial loss. Renters insurance is a type of insurance policy specific to renters and tenants only. Unlike home insurance, tenant insurance generally does not cover the structure of the building, but it does cover the tenant’s personal property that is inside the apartment.
Renters insurance exists to protect you and your belongings in the event of an incident, such as theft or fire, while you are renting. The insurance policy would then compensate you for damage to your property. Renters insurance also protects tenants from liability in case someone is injured in your apartment.
Why Every Tenant Needs Tenant Insurance
Landlords require tenants to provide proof of tenant insurance. This helps protect property managers from liability, but also protects tenants. People who have renters insurance can breathe easy knowing it protects their personal property. Here are a few reasons why you should buy tenant insurance:
- Provides protection for your personal items from theft or natural disasters
- Covers you from personal liability if someone is injured in your apartment
- Often forced to sign a new lease
- Sometimes required for lease renewal
- Can save you money if something were to happen to your belongings
- Brings peace of mind to tenants
- Helps speed up the rental process and avoid waiting periods if you already have a policy
Whatever your reason for getting tenants insurance, it’s a good idea to have it when you live in rental accommodation.
What exactly does tenant insurance cover?
We’ve talked about the benefits of having tenant’s insurance, but what exactly does tenant’s insurance cover? Your coverage will vary depending on your insurance company and policy, but in most cases, renters insurance policies provide these types of coverage:
Personal Property Coverage
Personal property coverage includes repairs or replacements of lost or damaged property, such as furniture, electronics and clothing. Depending on the policy, it may cover the costs of things like jewelry, but you’ll need to check with your insurance provider to see how much coverage comes with your plan.
Liability insurance protects the tenant in the event of an injury occurring to someone in the apartment and requiring medical attention. There is often a cap on the amount of liability coverage, so read your policy carefully.
Coverage of additional living expenses
Cover for additional living expenses includes the cost of hotel or travel bills should your apartment become uninhabitable due to an incident occurring on site. This part of a policy won’t cover property damage to the building itself – that’s usually the landlord’s responsibility – but it will cover your hotel bills while you find a new place to rent.
You’ll likely have higher premiums when you purchase additional coverage, and it’s up to you to determine how much renter’s insurance you need and how much coverage your landlord needs. Do your research to select the best policy for you.
How to show proof of tenant insurance to your landlord
We mentioned that landlords require proof of insurance to rent a rental property. But how do you show proof of tenant insurance to a landlord? Here are several ways to show proof of renters insurance.
1. Provide the declarations page to your landlord
Every renters insurance policy will have a declarations page that outlines the details of your coverage. The declarations page will include things like your name, policy number, and the amount of coverage you purchased. You can send a digital copy directly to property management as proof.
2. Share a digital file with the owner
You can show digital proof of your insurance by emailing the owner a copy of the entire policy or the declarations page itself. When you submit electronic evidence, you have a digital fingerprint that shows your communication with the owner. You can even ask your landlord to store this electronic copy on their property management software so you have a record of it.
3. Show them the physical copy of the renters insurance policy
If you are older, you can print a physical copy of the policy as a way to show proof of coverage. Print one copy for your records and print a second copy for the owner to have as well.
4. Ask your insurance agent to contact your landlord to confirm
If your landlord accepts verbal confirmation, you can ask the insurance company to call the landlord directly to show proof of insurance. Let your landlord know when your insurance agent will contact them so they can be prepared for the call.
5. Add the owner as an interested party to the policy
On any insurance policy, you can add an interested party to the policy. It is a way to prove that the renter has insurance. When the insurance agent writes the policy, they will add the owner as an interested party and then notify the owner at the end of the policy.
6. Share policy number and insurance agency with your landlord
Another way to show proof when renting is to share policy details with your landlord. You can share information such as policy number, name of insurance company and agent, or amount of coverage purchased.
7. Give verbal assurances from your tenant’s insurance policy
According to property managers, you can provide proof by giving verbal confirmation of coverage. While it’s as good as your word for it, some owners are okay with this kind of evidence. Keep in mind that there is often no digital or written record of verbal assurances, so this is not the most concrete or secure way to show proof of renters insurance.
These are some of the most common and accurate ways to show proof of coverage when owners require proof.
How much does tenant insurance cost?
Renters insurance is relatively inexpensive and ranges from $15 to $20 per month, or $180 to $220 per year. The cost of the policy will depend on the amount of coverage you purchase. Some landlords will even require you to have certain coverage, but this varies by location, landlord, and even state. When analyzing your budget, it is important to include renters insurance along with your other utilities.
Keep in mind that most policies are renewed every year and if you don’t automatically renew your policy, your policy will expire and you may temporarily lose your coverage. You should also pencil in the cost of the agent’s compensation, if they charge a fee to write a policy.
How to Get Your Own Renter’s Insurance Policy
If you’re trying to rent an apartment and can’t sign the lease until you have proof of tenant insurance, it’s time to find a policy for you. There are ways to find an insurance agency that you have installed:
- Ask your new landlord for advice
- Use your existing insurance agency and bundle it with your car insurance, for example, to save money
- Use an online comparison tool to find an insurance company
- Do an online search to find an insurance agency
- Ask your neighbors who they use
- Go to your local insurance broker
Proof of renters insurance is essential
Once your policy is in place, you’ll be happy to know that you can then sign the lease, move into your new apartment, and feel safe knowing you’re protected against the unexpected.