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Can You Have Two Renters Insurance Policies

By David Krug David Krug is the CEO & President of Bankovia. He's a lifelong expat who has lived in the Philippines, Mexico, Thailand, and Colombia. When he's not reading about cryptocurrencies, he's researching the latest personal finance software. 13 minute read

How much money would it take to replace everything you own if your house were destroyed by fire? You would have to buy a new set of clothes, a new set of furniture, a new set of devices like a television and computer, and even new wall hangings and rugs. 

Brand-new bicycles, stereo gear, and kitchen appliances, as well as new pots, pans, and utensils. Replacing our belongings would likely cost $10,000 or more for most of us.

Hence, it’s not a sum you can easily disregard. Now, insert the renter’s insurance. Although the name may be misleading, this insurance protects your items wherever they may be located, not just at home. 

Renters insurance is offered by insurance firms to distinguish themselves from homeowners insurance, which covers both personal belongings and the building itself.

It is highly recommended that everyone should carry some form of personal property insurance. The good news is that the monthly fee is usually between $5 and $20, depending on the level of coverage you select.

Principles of Renters Insurance

Insurance for renters from a provider like Lemonade functions similarly to that of auto and home insurance. When you sign up for insurance, you choose a plan, a deductible amount, and a payment frequency (monthly, semiannually, or annually).

You can make a claim if your belongings are stolen, damaged by fire, or ruined by sprinkler water. After you pay your deductible, the insurance provider will assist you to replace your lost or damaged goods.

Renter’s insurance not only covers the cost of replacing your items but also helps with other housing-related expenses. Some renter’s insurance policies can pay for someone else’s medical expenses if they are injured on your property, such as if they fall down your stairs. 

In the event of a house fire, many insurance policies will pay for temporary lodging expenses. If a calamity forces you to relocate permanently, certain policies can pay for your relocation costs.

The quality of an insurance policy is proportional to its premium. Cheap renters insurance policies typically have low coverage limits and large deductibles. Even so, your need for insurance protection may be so simple that merely the barest minimum will do.

Actual Cash Value vs. Replacement Cost

Renters insurance is available from insurance providers based on either the real monetary value of your things or their replacement value. In theory, both plans should pay out the same amount, but in practice, they’re significantly different.

  • True Market Value in Dollars. An actual cash value policy requires an insurance adjuster to evaluate the property damage and depreciation costs before settling a claim. Depreciation means that a laptop purchased five years ago for $1,800 is now only worth $300. The insurance company will pay you $300 if your laptop is destroyed in a fire and you file a claim. It makes little difference that buying a new, modern computer will probably cost you an additional $1,800. Consequently, premiums for actual cash value plans are typically less than those for replacement value policies.
  • What it Would Cost to Replace Something. If you have a replacement value policy, the insurer will reimburse you the amount necessary to buy new equivalents for your damaged belongings. What this means is that if a laptop you bought five years ago for $1,800 is destroyed in a fire, the insurance company will pay you the greater of $1,800 or the price at which you might purchase a comparable laptop brand new today. In the event of a claim, the higher premiums associated with this sort of coverage are often well worth it.

Standard Coverage of Renters Insurance

Your personal belongings are protected by all renter’s insurance policies. That includes both movable and fixed outdoor and indoor properties. Therefore, renters insurance typically covers the cost of replacing a stolen laptop if you had it in a bag that was stolen.

The contents of your home, as well as those of your close family members who also reside with you, are normally covered by a renters insurance policy. There is protection for your spouse’s wardrobe and your child’s (5-year-old) wardrobe. Are these your live-in girlfriend’s clothes or those of your recently-emancipated adult child? 

Actually, no. It’s safe to assume that the following risks are covered by most renters’ insurance policies. Before agreeing to insurance, be sure you fully understand its terms, including any limitations or exclusions.

Fire Damage

Damage caused by fire is covered by all renter’s insurance policies. It’s the backbone of any property insurance policy. You won’t be out of pocket if an electrical fire destroys your home. In the same vein, each unforeseen blaze is equally as dangerous. But arson fires might not be covered.

Wildfire damage is typically covered by standard renters insurance plans. Some insurers, however, consider wildfires to be natural disasters, which we will discuss further below.

Smoke Damage

Similar to homeowners insurance, nearly all renters insurance policies will cover damages caused by smoke. Even if the flames don’t reach the clothes, linens, or furniture coated in fabric, the smoke can swiftly destroy it.

Water Leakage Has Damaged the Property

In the event of a fire or malfunction, the sprinkler system might instantly destroy all of your belongings. The electric circuit failed. Water damage and mold on clothing and furnishings. 

The mattress is soaked. Little in one’s possession can withstand being doused in water for an extended period of time. Broken plumbing, such as a burst pipe, is typically covered under this policy. However, water damage is not included — we’ll get to that in a little.

“Normal Storms” as Identified Risks

There are a variety of regular storms that are typically listed as covered risks in renters insurance policies. The term “extreme weather” is used to describe a wide range of phenomena, from the commonplace (wind, lightning, hail) to the extremely rare (tornadoes, volcanic eruptions). 

Nonetheless, if you happen to call a tornado alley home or the edge of an active volcano your own, you’ll want to study the tiny print to be sure that your specific risks are covered. A TV that is crushed when a tree branch falls on it during a storm is usually covered by insurance.


Theft is covered by renters insurance, whether it’s a break-in at your apartment or someone snatching your phone as you walk down the street. However, if the latter occurs, your deductible may be more than the cost to buy a new phone outright. Should anything be stolen from you, you will not be out of pocket.


Similarly, vandalism is not tolerated. Your renter’s insurance coverage will typically pay for the cost to repair or replace your damaged goods if someone else willfully causes that harm.

Optional Additional Coverage

Coverage options for renters insurance go beyond the standard minimums. It’s not mandatory, but you might want to think about it if you have a lot of valuables or aren’t afraid of losing them.

Specific Valuables

If your house burns down, the $50 jewelry you bought at the department store will be reimbursed to you. How about that $20,000 diamond ring you’ve got your eye on? But that’s another tale.

Jewelry is typically covered by renters insurance, but only up to a certain amount. Jewelry with a higher value usually requires supplemental insurance.

The same holds true for priceless works of art and other collections. Your belongings are covered up to your policy’s limit, but if you have a $50,000 painting and don’t specifically include it, you’ll be out of luck.

Costs of Temporary Living

After a fire destroys your flat, you’ll need to locate a new place to stay until your landlord can make the necessary repairs. In the event that you are displaced from your home for an extended period of time, temporary housing expenses may be covered by your renter’s insurance policy. 

This can entail spending money on a traditional hotel room, a less conventional option like an Airbnb rental, or even fully equipped corporate housing.

Relocation Expenses

Unfortunately, not all landlords can afford to make necessary repairs to rental properties as quickly or at all as tenants would want. There’s a risk that the structure will catch fire or will need extensive repairs.

If that’s the case, you won’t require any sort of short-term housing. You really ought to find somewhere else to call home. If your home is destroyed, many insurance policies can pay for your relocation costs.

Responsibility & Medical Costs

Unfortunately, we live in a litigious world, where some individuals will not hesitate to file a lawsuit if they believe they have a legitimate claim to monetary damages.

In the event that someone gets wounded on your property and sues you, certain renter’s insurance policies will cover legal fees and medical expenses. Your neighbor may file a lawsuit against you for damages and medical bills if their child is attacked by your dog. Your renter’s insurance should cover that.

You may also consider the alternative: you’re the host of a party where someone is injured. Or maybe you set fire to your neighbor’s house by mistake and their stuff gets destroyed.

This coverage for medical costs is in addition to any other health insurance you may have. If someone tries to sue you for medical expenses, this policy will pay for it. It also doesn’t protect you from being sued for damages you cause in an automobile crash. That’s covered by the car insurance you have.

Natural Disasters

Lightning strikes are common, but hurricanes are much more dangerous. In most cases, renters’ insurance will cover the damage caused by a storm, but it won’t cover damage caused by a natural disaster unless you purchase additional coverage.

Catastrophes of this type include earthquakes, storms, and sinkholes, among others. Worried about disaster damage? Talk to your insurance company about expanding your coverage.

Flood Damage

The renter’s insurance policies do not pay for flood damage unless the renter purchases supplementary flood insurance.

Water damage caused by plumbing issues, such as a burst pipe or an activated sprinkler system, is covered. However, unless you have flood insurance, your homeowner’s policy will not pay for repairs caused by water coming into your home due to flooding.

If you’re worried about whether or not your home is in a flood zone, you should definitely do some investigating. The National Flood Insurance Program’s official website, SmartFlood, is where you may accomplish this.

Security of Identity

With the prevalence of online services in today’s market, identity thieves are certain to get some of your financial details at some point. Definitely give identity theft protection your full attention. However, due to the high cost of repair after an accident, insurance is strongly recommended.

In the event that you’re concerned about identity theft, you can get insurance separately. However, adding this to your renter’s insurance as additional coverage is typically less expensive.

What a Tenant’s Insurance Policy Never Covers

After a tragedy, some tenants learn that their insurance policy may not fully cover their losses. Some things are never covered by renters insurance, regardless of whether they are included in the policy or not. Don’t make any hasty conclusions regarding your insurance without first reading these.

Fixtures Possession of the Landlord

Your renter’s insurance will not cover any landlord-owned fixtures, but their insurance will. It’s common practice for landlords to supply tenants with a number of major equipment like refrigerators and ovens, which they own and maintain. 

Similarly, they might let you use their backyard barbeque, but they might decide not to replace it if it is damaged or stolen. You should not expect your renter’s insurance to cover this kind of loss.

However, your renter’s insurance may cover a personal appliance that you bring with you.

Unreported Items

When filing a claim, you must be able to demonstrate legal possession of the claimed items. Then, after a fire, anyone could file a claim for anything they wanted to try to get the insurance company to pay for it.

Always keep duplicate purchase receipts for anything of significant value. The purchase of a $15 T-shirt does not need you to maintain the receipt. But that $1,500 television set you recently purchased? In other words, the claims adjuster is not going to accept your word for it.

The use of a fireproof safe is one alternative for storing paper receipts. A better option is to simply take a picture with your phone and store it in a digital folder on your computer. Combine it with a cloud backup service, and you’ll have a duplicate of your data even if your computer is destroyed in a fire.

Animal Medical Care

Other than potentially protecting your liabilities if your pet were to harm someone, renters insurance does not cover your pets.

The cost of emergency veterinary care for any pets wounded in a house fire or natural disaster is entirely on the pet owner. Insurance coverage for your pet is a different product. Both policies, even if offered by the same insurer, are different.

Your Roommate’s Personal Effects

You and your household members are the only ones whose belongings are protected by renters insurance. Any property owned by anyone else, regardless of whether or not they share the same roof, is not protected.

That includes roommates as well as couples who share living quarters. There are a lot of advantages to getting married, and having combined insurance is one of them.

Autonomous Vehicles

Let’s pretend your automobile and the $1,500 worth of items in it were stolen. What are the implications for insurance, if any? You’ll need to report the damage to your automobile to your auto insurer and your personal property to your renter’s insurer.

Motor vehicles are not covered by renters’ insurance. Mopeds, electric bicycles, Segways, and motorized scooters are included in this category as well, in addition to vehicles, trucks, and motorbikes.

Pest Damage

Don’t count on your renter’s insurance to pay for your wardrobe replacement if mice chew through every item of clothing in it. You won’t be able to make a claim for pest-related damage on your renter’s insurance. 

This is true for every type of pest that makes its way into your home, be it a mouse, cockroach, ant, termite, or any other kind of creepy crawly. Just another reason to keep your house in pristine condition!

Rental Insurance Premiums

Renter’s insurance is very affordable compared to other types of protection. The Insurance Information Institute reports that $180 is the typical cost of an annual insurance premium. Compared to other monthly video streaming services, that’s a steal at just $15.

Costs can be reduced even further by shopping about, which is why many consumers prefer to get insurance through an online provider. Renter’s insurance from Lemonade starts at just $5.70 monthly on average for a basic policy.

It’s true that the cost of insurance policies varies according to factors like coverage levels and deductibles. Premiums will skyrocket if you wish to insure $100,000 in belongings as opposed to $10,000.

Additionally, if you prefer a deductible of $200 instead of $1,000, you’ll need to budget for it. Make sure you do your research before committing to any one insurance provider. 

Prices vary frequently and some service providers provide better deals and more comprehensive plans than others. Be proactive in your search for adequate, reasonably priced coverage. Start by looking through our recommended companies for renters insurance.

What You Should Do

Renter’s insurance quotes typically require less information from policy seekers than do other types of insurance. The majority of service providers now give online quote tools. 

You may be asked to provide information such as your name, address, phone number, the names and ages of any pets you have, whether or not you live in a household with roommates, and the presence or absence of safety features in your home (such as smoke detectors and an alarm system). 

A Social Security number may also be required by some insurance firms. Some dog breeds are considered inherently more dangerous by insurance companies than others based on data analysis. 

There is a chance that insuring such large pets would increase your rate for liability coverage. A greater premium could be the result of sharing a home with another person.

Following that, you’ll be able to choose your desired level of coverage, deductible, and any other features. So, et voilà! Immediately, a price estimate is provided.

Putting in a Claim

These days, the majority of insurance claims can be submitted online or over the phone. Keep your policy number close by so they can quickly locate your file.

Make sure you have proof of everything you want to be covered when you file your claim. Keep digital or paper copies of receipts in a secure location, preferably the cloud, as proof of payment. In order to get a replacement for an item that costs more than $50 or $100, you’ll need to be ready to show proof of ownership.

Rental insurance claims are often handled quickly by most firms. They can make a payout in as little as a few days. Payment from sluggish businesses usually takes a few weeks, so having an emergency fund is important.

Bottom Line

You should compare prices just like you would for any other kind of insurance. Gather quotes from multiple insurers, and make sure to inquire about savings and the specifics of coverage with each agent.

When clients purchase multiple policies from the same insurer, like a car and a homeowner’s plan, they often receive a discount. Having or agreeing to install security systems, deadbolt locks, smoke detectors, and sprinkler systems in your house may potentially qualify you for discounts.

You certainly don’t want to waste money on insurance protections you won’t ever use. In order to know what parts of the rental property your landlord is liable for fixing or replacing, it is important to review the lease. On top of that, your landlord’s property insurance may already cover exterior and building damages.

In cases of uncertainty, basic protection should be sought out first. Coverage levels can be increased in the future, so start low and scale up gradually.

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