Is Renter’s Insurance a Must?

There is no legal requirement in California for a tenant to have renter’s insurance. However, there are a number of reasons why it makes a great deal of sense to have this coverage. The property you live in may belong to someone else, but all the possessions in it are yours. In California, it is necessary for landlords and building owners to have insurance on the property they rent out. This insurance will cover damage or loss in relation to the structure, but not the tenant’s belongings inside it. Some property owners may require the renter to buy a renter’s insurance policy before issuing a lease, but many do not. Having a renter’s insurance policy protects you from a range of risks and financial losses. These include:

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• Loss of Property: Renters insurance will cover you against the loss of your personal possessions due to an unexpected occurrence or disaster. There is generally a minimum amount that is set by the insurance company.

• Personal Liability: Claims against renters for damage to property caused by their negligence is on the rise. Cases of lawsuits being filed against renters alleging that personal injury was caused by their acts of omission or commission are also increasing. Court costs and damages (if awarded) could be huge and could ruin a person financially. The claims could be filed by the landlord or other tenants.

• Loss of Use: If the place you live in is damaged or becomes uninhabitable for any cause covered by the renter’s insurance policy, you will be covered against any additional living expenses. These include hotel accommodation and meals until such time as you are able to find new accommodation. The amount of the coverage and the duration you are covered for will depend on the terms of the policy.

• Medical Payments to Others: If a person should be injured in your rented home, you could be held liable for that person’s medical costs and other claims. Renters insurance will protect you from any potential financial loss if this should happen.

You may be a renter, but the place you are renting is your home and not being able to live there or facing huge liability claims because of your occupancy of the premises can be devastating. People generally think of the structure when the topic of property loss comes up. The possessions inside the home that may be damaged or lost are usually given less importance. It is easy to underestimate the value of your possessions. It is only when they are lost and need to be replaced do you realize their worth. The problem is that when realization dawns, you may not have the financial resources needed to make the replacements. Even if your landlord does not require you to have renter’s insurance, it is a coverage you must have. Contact an insurance agent who will be able to give you the coverage options and help you find the policy that is right for you.