Are Pets Covered by Renter's Insurance?

A question we often hear when talking about renter's insurance is, “What type of provisions does a renter's insurance policy include regarding pets?” This is a good question, and the answer applies equally to both renter's and homeowner's insurance.

Renter's Insurance Coverage

Renter's insurance typically provides three types of financial protection. These include:

• Personal Property Protection – covers your rental home's contents and your personal belongings against loss/damage resulting from specific named perils.
• Liability Protection – covers you and your family members living in your rental home from financial loss resulting from liability lawsuits or medical expenses stemming from a visitor to your home becoming injured.
• Additional Living Expenses Protection – if your rental home becomes unlivable as the result of a peril covered in your policy, this benefit will reimburse you for expenses incurred while temporarily being forced to live outside of your residence, within stated policy limits.

Pets Are Not Considered Personal Property

Of the three protections listed above, the only one that applies as a form of pet insurance is the second, liability protection. Personal property protection doesn't apply because insurance companies don't consider pets as personal property. Dedicated pet insurance is available from various insurance companies for financial protection should your pet become ill or injured, just as your medical insurance covers you in the event that you become ill or injured. Renter's insurance, however, is not applicable regarding your pet's illness or injury.

How Liability Factors In

The liability coverage contained in your renter's insurance policy could be looked at as a type of pet insurance in that it provides you with financial protection should your pet either cause damage to your rental home or inflict an injury to a third person, whether inside or outside of your actual residence.

The liability coverage in your renter's insurance won't cover all pet-related damage nor will it apply to all pets. Some breeds of dog, for example, may be excluded by your insurer. Typically, this includes breeds known to be aggressive. The most common pet-related liability claims made against renter's insurance policies are dog bites. Certain exotic pets such as monkeys or reptiles may also be excluded.

Damage caused by your pet to your rental home will likely be covered, however, this doesn't extend to damage to your own personal property. If your dog gets loose and tears up your neighbor's garden, this would likely be covered.

Renter's Insurance: How Much Is My Stuff Worth?

If you're out there shopping for a Greensboro Renters Insurance policy, you're to be commended. You're in the minority in an area where making the right decision can have a huge financial impact on your life.

Homeowner's vs. Renter's Insurance

According to the Insurance Information Institute (III), approximately 97% of homeowners in the U.S. carry homeowner's insurance while less than 40% of renters carry renter's insurance. There may be several reasons that so many renters remain without coverage:

1. Some may feel that the personal property they have doesn't have a high enough value to warrant insuring it.
2. Some may feel the cost of renter's insurance is too high to justify this ongoing expense.
3. Some may not realize the benefits that come with a renter's insurance policy.

Is It Worth It?

Bringing clarity to the three above-listed concerns may be just what you need to justify your taking out Greensboro Renters Insurance coverage.

As far as total value of your possessions goes, you likely have much more in value than you think. Once you factor in all of your clothing, all of your furniture, all of your electronics, your books, dishes, kitchenware, etc., you likely have thousands more than you've considered. A typical renters insurance policy with a personal possessions limit of $30,000 would probably cover you adequately, but once you start adding everything up you might even want more protection.

Cost for a typical renters insurance policy is surprisingly low. According to the III, here in North Carolina the average cost for renter's insurance runs about $157 per year, which is only about $13 a month.

Considering what you get for that $13 per month premium payment is also to be seriously taken into account. Not only are your personal possessions covered against numerous threats such as fire, smoke, explosion, theft and other perils, you also have significant liability protection. This means if someone becomes injured while on your rental property and you end up getting sued for damages or medical costs, you have a certain amount of liability coverage. Limits for liability coverage are typically around $100,000, and this can go toward court costs, legal fees and any judgments you face.

For a few dollars more, you can increase policy limits by quite a bit. This may be the lowest cost, highest value insurance you can buy. One time use could pay back a lifetime of premium dollars!

6 Facts About Named Perils

When you buy homeowner's (or renters) insurance, you're buying financial protection against losses pertaining to your personal property, or, “your stuff”. This includes your home's structure, exterior buildings such as a detached garage or garden shed, and everything within the walls of your home such as appliances, furniture, electronics, clothing, artwork, jewelry, etc.

While each homeowner's policy is different and may be custom designed to fit the policyholder's specific needs, the average homeowner's policy provides similar protections.

Named Perils vs. Open Perils 

Standard homeowner's or renters insurance policies protect against what are called “perils,” which are bad things that can happen to your property that cause you to experience financial loss. An “open perils” policy, sometimes called a “named exclusion policy” or an all-risk or comprehensive policy, covers any bad thing that can happen to your personal property except those things specifically excluded in the policy. In a “named perils” policy, however, only the perils specifically listed within the policy are covered. Here are some key factors to understand about named perils:

1. Named perils can basically represent whatever specific protection you desire in your policy, as long as the insurer agrees and you're willing to pay the cost of the policy that they charge for that protection.
2. Most standard policies cover 16 named perils: 1. Fire/lightning damage, 2. Windstorm/hail damage, 3. Explosions, 4. Riot, 5. Being hit by aircraft, 6. Being hit by a vehicle 7. Smoke damage, 8. Vandalism, 9. Theft, 10. Falling objects, 11. Ice, snow or sleet damage, 12. Accidental overflow or discharge of steam or water, 13. Sudden, accidental cracking, burning, bulging or tearing, 14. Freezing, 15. Sudden, accidental damage caused by short-circuiting, 16. Volcanic eruption.
3. Most standard homeowner's policies do not cover for damage due to floods or earthquakes. Coverage for these perils must be obtained by taking out separate policies or having a special amendment to your standard coverage.
4. Compensation for a covered loss under your homeowner's policy will only be paid after subtracting the amount of your deductible.
5. A named perils policy only pays for losses caused by a peril specifically spelled out in the policy. If, for example, it doesn't say you're covered for sewer backup, you aren't. As the insured, the burden is on you to prove that your loss was caused by a named peril in your policy.
6. Because only specific perils are covered, these policies are typically less expensive than open perils coverage.

Do College Students Need Renter's Insurance

If you're going off to college or are sending someone off to college, you'll likely find that there are countless details that need to be considered. Although it may not be obvious, you should definitely consider the importance of covering your possessions with some type of insurance policy.

Dormitory Living

If you'll be living in an on-campus dormitory, you may find your personal possessions are actually covered to some extent by your parents' homeowner's insurance policy. You'll need to check the policy or consult with your insurance agent to find out what kind of coverage there is and, if coverage exists, to what extent it will pay for losses to your possessions while you're away at college.

Coverage for college students living away from home will usually have a cap on claim amounts allowed – typically 10% of what's covered for the main policyholder living at home. Policies that cover students living in dorms also usually have an age cutoff, typically age 26, after which students no longer qualify to be on their parents' policy. It's also common for coverage to exclude liability and loss of use coverage.

Students Not Living in the Dorm

For students not living in a dorm on campus or for those who aren't covered for loss of their personal possessions under their parents' homeowner's policy, the best alternative is to obtain renter's insurance coverage. While insurers won't write a renter's insurance policy to cover a dorm room, some have policies available for specific coverage of personal possessions in a dorm room, absent of the added liability and loss of use coverage.

Students living off campus, in an apartment or house, can buy a renter's insurance policy at an affordable price and cover not only loss of their personal possessions but also liability protection in case someone gets injured on the property they're renting. They will also have coverage for loss of use of their dwelling, in the event that something occurs that makes their home no longer habitable for a period of time.

While it may be easy for a college student to rationalize foregoing the purchase of renter's insurance because they have few valuable possessions, it's also easy to miscalculate the value of what they own. But even more importantly, the value of having financial protection against a liability lawsuit cannot be overstated. Loss of use is also a valuable protection to have.

Does My Roommate Need Renters Insurance Too?

A 2015 poll conducted by ORC International (Opinion Research Corporation) for the Insurance Information Institute (I.I.I.) estimates that, while approximately 95% of the homeowners in the United States maintain a homeowner's insurance policy, only about 37% of renters buy renters insurance coverage. This may be partly because when you buy a house by borrowing money from a mortgage provider, they'll require that you have homeowners insurance coverage in order to protect their financial interests in the home. Nobody requires renters to buy and maintain renters insurance.

What is Renters Insurance?

As a renter, the dwelling you occupy is most likely covered by your landlord's insurance, which protects the home or apartment from typical perils facing homeowners, such as fire, hurricanes, hail, lightning, etc., but what their insurance doesn't cover is your personal possessions. If the home is damaged or destroyed by fire, for example, the landlord's coverage will help pay to repair or replace the dwelling. Your personal possessions within the dwelling, however, will be a total loss unless you have renters insurance to help repair or replace them. Most renters coverage also includes protection against liability should someone suffer a loss in the home due to your negligence. You'll also be protected against theft, unless the theft is committed by your roommate.  

Coverage for Your Roommate

If you have a roommate, he or she can be added to your renters insurance policy or they can opt for their own separate coverage. If you add them to your policy, you may save money by splitting the premium costs, but if a claim is made and paid, the check will be made out to both of you. Even if only your possessions are lost, damaged or destroyed, the claims payment will be made jointly, and it'll be up to you to determine how to split it.
Likewise, if your roommate makes a claim, it will also show up on your personal insurance history, which could change your risk profile for buying future coverage. Additionally, if your roommate is faced with liability issues, with a joint policy you'll also be involved in the legal process.

With renters insurance, only those named on the policy will have protection. If you change roommates often, it might make sense to maintain your own policy, especially since rates are so reasonable. Saving a few premium dollars is really the only advantage to having a joint policy.