Renters Insurance Compared to Homeowners Insurance
Are you considering purchasing a home for the first time? Or maybe you’re downsizing, selling your home and moving into an apartment? Whether you’re a renter becoming a homeowner, or a homeowner becoming a renter, you have a lot to think about.
As far as insurance is concerned, be sure you understand the type of insurance you’ll need. We’ll be diving into the key differences between renters and homeowners insurance.
Homeowners and renters insurance require regular payments that can range from monthly up to one lump annual payment, and a policy must be in good standing in order to pay out on a claim. Both also require the payment of a deductible for claims, unless otherwise specified in the policy.
Pittsburgh Renters Insurance
Renters insurance is for occupants who do not own the property but want to protect their personal belongings that are in the home or on the property. It is important for renters to note that the property owner’s insurance policy does not cover them, and their items are lost in the event they are damaged or destroyed. Renters insurance policies will reimburse a renter for the replacement cost of property that is lost or damaged while on the property.
Landlords may stipulate or recommend that tenants obtain their own renters insurance in the lease agreement, absolving the landlord of responsibility for lost or stolen items belonging to tenants.
Pittsburgh Homeowners Insurance
A homeowners insurance policy is taken out by the owner of the home. A property owner is not obligated to insure his or her property unless there are special circumstances, but a homeowner who has a mortgage is usually required to take out an insurance policy.
Renters should never assume a landlord’s insurance will cover anything they own in their rental or on their rental property.
The amount of insurance generally covers the cost to replace the home in the event of a total loss, and additional insurance can be added to cover the replacement value of the items in the home. If a home costs $300,000 to rebuild and the items inside the home cost $150,000 to replace, a homeowner who wanted to cover everything would need to insure the property for at least $450,000.
Most standard homeowners insurance policies will have personal property coverage as well, and it is becoming more common for landlords to require their renters to buy renters insurance. Since you are insuring a more substantial asset with homeowners insurance, the expected cost will be higher as well. Most homeowners and renters insurances also have liability coverage associated with them.
If you have are renting or own a home, contact us today to get started!