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Renters insurance protects your personal property and offers other protections, such as personal liability and loss of use coverage.

Renters insurance is a way to ensure that you have enough coverage to protect your belongings and against liability. There are also parts of renters insurance that can help you pay for lodging and meals if you’re forced to leave your home because of damage.

Landlords have their own insurance. A landlord’s policy likely only covers the structure and not your possessions. That’s why it’s critical to look into renters insurance if you’re renting.

Plus, many landlords require tenants to have a renters insurance policy.

What does renters insurance cover?

A renters insurance policy has multiple aspects that help protect your property and against lawsuits.

You decide the level of renters insurance coverage, which influences your premiums. The renters insurance rate in the U.S. is $326 a year -- or about $27 a month. Costs vary by location and state, such as Florida, though.

Here are four parts of renters insurance.

Personal property

A key part of renters insurance is that it protects your personal property. Personal property is anything in your apartment or even possessions in other places.

You’ll want to take an inventory of your belongings before getting a renters insurance policy. Make a list of everything:

  • Computers
  • Electronics
  • Televisions
  • Clothes
  • Furniture

Estimate what they’re worth. You can then figure out how much coverage you need to replace those items if they’re damaged or stolen. Renters insurance companies often offer between $20,000 and $60,000 in personal property coverage, though you can also get much lower limits.

Personal property covers items even if they’re not in the apartment at the time of loss.

For instance, belongings are covered if they’re stolen from your car or damaged in a move. Note: Auto insurance doesn’t protect you if items get stolen from your car except for vehicle components, such as a GPS.

However, personal property coverage is usually capped at 10% of the total personal property limit for thefts involving a vehicle. That means $5,000 in coverage would reimburse you up to $500 for stolen items from a car.

You can also buy endorsements for more personal property protection, such as expensive jewelry, fine art or sports memorabilia. Renters insurance policies typically have limits on high-cost items, such as $2,000 for jewelry, $2,500 for firearms and ammunition and $1,000 for baseball cards and collectibles.

If you feel you need more courage for expensive items, check out increasing coverage, such as through an endorsement.

Personal liability coverage and medical expenses

Renters insurance covers personal liability coverage. This can help if someone is injured in your apartment or you cause damages to other people or property.

You can choose a personal liability limit of between $100,000 and $500,000. It’s wise to have at least $300,000. Having that much protects you up to that limit if you’re sued.

If you have assets that exceed $500,000, you can get an umbrella policy. Umbrella insurance provides added asset protection that can reach $5 million and beyond.

Personal liability also protects you if you damage another property. It doesn’t cover you if you damage your own property.

Liability provides no-fault medical coverage, which helps you if someone gets injured. Medical expense coverage is often between $1,000 and $5,000.

Loss of use coverage

Renters insurance includes loss of use coverage that helps you if a covered peril damages your apartment and is inhabitable.

Covered perils include:

  • Fire
  • Smoke damage
  • Lightning
  • Wind
  • Hail
  • Explosions
  • Vandalism
  • Theft

You can also ask about an all-risk insurance policy. These rental insurance policies go beyond the covered perils. The one major downside to all-risk policies is that they’re expensive.

Additional living expenses

Additional living expense (also called ALE) helps if you’re unable to live in your apartment. It’s a part of loss of use protection.

This could happen if a fire damages your apartment or a storm causes extensive damage.

ALE covers:

  • Hotels or lodging
  • Meals
  • Laundry
  • Moving costs if you have to evacuate for an extended period
  • Extra gas to get to your temporary location
  • Other related expenses

Additional living expenses coverage helps you maintain your lifestyle while you can’t stay in your apartment. Renters insurance companies expect you to keep your usual standard of living. If you stay at a swanky hotel and buy lobster for every meal, the insurance policy may limit the payout. The renters insurance company only pays the maximum amount in the policy.

Renters insurance only covers you for additional living expenses for a limited time. Check your policy to find out how long you're reimbursed. It’s usually 12 or 24 days.

What other things does renters insurance cover?

Renters insurance can also include other coverages and policy add-ons. Here are a few of them:

  • Spoiled food -- You lose power after a covered peril, such as a storm. Renters insurance often covers you for the items spoiled in the fridge.
  • Credit card or financial fraud -- Renters insurance can help you if someone steals your identity and charges thousands on your credit card.
  • Stored items -- Living in an apartment means you may have to keep some of your belongings elsewhere. Renters insurance policies may cover those possessions even when they’re not in the apartment, including a storage unit.
  • Removing debris -- A renters insurance policy may help with costs associated with damage from a covered peril.

What is not covered by renters insurance?

Renters insurance doesn’t cover structural damage. That’s the landlord’s responsibility.

Renters coverage also only covers what’s listed as a covered peril. Here are issues usually not considered a covered peril:

  • Flooding from outside the apartment
  • High-price items that exceed your policy limit
  • Earthquakes
  • Bedbugs
  • Pest damage

Make sure to look at your renters insurance policy’s covered perils. That list tells you what’s covered. Anything that’s not listed isn’t covered by your renters insurance.

Does renters insurance cover broken windows?

Renters insurance doesn’t typically cover broken windows. Instead, a landlord’s policy should cover the broken window.

However, a renters insurance policy may cover you to stay somewhere else until the window is replaced and you can return home.

If you break another person’s window, renters insurance covers you through the personal liability portion of your renters policy.

Here’s what you should do if a window gets broken in your apartment:

  • If damaged during a break-in, call the police and file a report.
  • Contact your landlord and have them secure the broken window.
  • The landlord should notify his or her insurance company.
  • If you’re not able to stay until the window gets fixed, contact your renters insurance company and explain the situation.

Does renters insurance cover accidental damage?

Renters insurance doesn't usually cover accidental damage to your apartment. Instead, the landlord’s policy covers that damage.

On the other hand, if your personal belongings get damaged or destroyed in the process, your renters insurance policy’s personal property portion may reimburse you.

Does a renters insurance policy cover fire damage?

Your landlord’s policy handles the structural damage and renters insurance typically covers your personal belongings.

What you get from the insurance company depends on your renters insurance policy.

  • Replacement cost reimburses you for the full cost to replace an item new.
  • Actual cash value provides you with the value of the damaged item at the time of loss, including depreciation.

Replacement cost is typically more expensive than actual cash value coverage.