Renters Insurance: What It Covers and Who Needs It

Key takeaways

Your landlord's insurance covers the building, not your belongings.
Renters insurance typically combines personal property, liability and additional living expenses coverage.
Most renters policies do not cover floods or earthquakes.
List what you own, then compare policies by coverage, limits, deductible and exclusions.

What renters insurance is

Renters insurance protects what you own and your legal responsibility to others while you rent a home. The National Association of Insurance Commissioners (NAIC) says most policies provide two basic types of coverage: personal property and liability. Some also pay your living expenses if you cannot stay in your home after an insured loss.

What it typically covers

Typical policies cover losses from fire or smoke, lightning, vandalism, theft, explosion, windstorm and certain types of water damage, such as a burst pipe.

Coverage	What it does
Personal property	Pays to repair or replace your belongings if they are damaged, destroyed or stolen in a covered loss.
Liability	Protects you against a claim or lawsuit for injury to other people or damage to their property caused by an accident. It has a limit, which is the most the policy will pay.
Additional living expenses	Usually pays for costs such as hotel bills, temporary rentals and restaurant meals while you cannot live in your home after an insured loss.
Medical payments	Pays medical expenses when other people are injured on your property.

Your landlord's insurance does not protect you

A landlord's insurance covers the building. The NAIC explains that it does not cover your belongings, and it does not protect you from being liable for damage you cause, such as a kitchen fire.

What it usually leaves out

Flood and earthquake. Most renters policies do not cover them. Flood coverage is available through the National Flood Insurance Program and a few private insurers.
The building itself, which is your landlord's responsibility.
Valuables that need extra protection. Ask your insurer about adding a floater for specific items.
Anything your policy lists as an exclusion. Read the exclusions section.

How to decide how much you need

Some landlords require renters insurance in the lease. Check yours, and if it does, ask what it requires.

Walk through each room and list what you own, with photos or video.
Estimate what it would cost to replace everything, and ask whether the policy pays replacement cost or actual cash value.
Choose liability limits that fit your situation, and ask about a personal umbrella policy if you want extra liability protection.
Compare policies by coverage, limits, deductible and exclusions, not only by price.

General information only. It is not insurance, legal or financial advice. Rules differ by state and change over time, so confirm details with your state insurance department, your insurer and your policy.

Common mistakes

Assuming your landlord's insurance covers your belongings.
Forgetting flood. Most renters policies exclude it.
Not listing what you own, which makes it hard to choose a limit.

Questions

Does renters insurance cover flood?

Most renters policies do not cover floods or earthquakes. Flood coverage is available from the National Flood Insurance Program and a few private insurers.

Does renters insurance cover my roommate's belongings?

Policies differ, so ask your insurer who is covered. A roommate may need a separate policy.

Is renters insurance required?

Insurers sell it as an optional policy, and some leases require it. Check your lease.

Sources

NAIC: Renting your home? Protect your belongings with renters insurancecontent.naic.org
NAIC: From homeowner to rentercontent.naic.org
NAIC: Understanding your homeowners or renter's policycontent.naic.org
South Carolina Department of Insurance: Understanding renters insurancedoi.sc.gov
FloodSmart.gov: National Flood Insurance Programfloodsmart.gov

Informational only. Rules and policy terms change and differ by state and insurer. Confirm details with your policy, your insurer or your state insurance department.