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Who Needs to Buy Renters Insurance? Renter or Landlord?

May 1, 2017
Renters

The correct answer is: you, the renter! Even though you and your landlord share common ground — literally — each party has very different responsibilities when it comes to protecting that shared space. Renters and landlords each need insurance that covers their individual assets in case of an accident or emergency. In this post we’ll answer some common questions and dispel some misconceptions about who is responsible for buying renters insurance.

Common misconceptions

Many renters think they don’t need insurance because their landlord has coverage. Unfortunately, this isn’t the case and without insurance you could wind up bearing the financial burden of replacing all your possessions after an incident. A landlord’s insurance covers damage to the rental property itself and doesn’t extend to a tenant’s personal belongings. This often means that renters are the ones who lose out on compensation if disaster strikes.

Who is responsible for what?

As a renter, you’re responsible for paying your rent in full and on time, abstaining from illegal activities, and preventing damage to the rental property, among other things. Some landlords or rental agencies may also require you to get renters insurance before you move in, so it’s a good idea to carefully review your rental agreement so you know what’s expected of you. Even if it’s not required, renters insurance is an important safety net if your personal property is stolen or damaged.

Landlords are responsible for maintaining common areas, repairing major appliances that came with the apartment and ensuring vital services like heat, water and electricity. They aren’t responsible for replacing your barbeque if it gets stolen off your patio.

Differences in coverage

Landlord insurance covers the physical building against risk from things like fires, storms and other natural disasters. It usually includes coverage for light fixtures, carpets, appliances and window coverings. Some policies also include coverage for loss of income due to unpaid rent. Again, a landlord’s main priority is protecting the structure of the rental property from damage, not replacing your possessions.

Renters insurance, on the other hand, will reimburse you for the cost of replacing your clothes, electronics, kitchenware and sporting goods if they are lost or damaged by an event that’s out of your control. In addition to personal property coverage, renters insurance provides liability coverage for injury or damage you may cause to others. That means your legal fees will be covered if you have to go to court for something that happened on your property or at a friend’s place.

What else? Renters Insurance may also pay for living expenses if your apartment becomes uninhabitable, which means that your food and lodging will be paid for if your suite gets flooded or damaged by fire.  

Why it’s important to have a good renter-landlord relationship

Life’s easier when we can all get along and a good renter-landlord relationship can make your living situation a lot better. Knowing what you’re responsible for taking care of and who’s responsible for repairs can help you steer clear of any disagreements. Good communication is key, because the sooner your landlord knows your sink is leaking, the sooner they can fix the problem and avoid a larger disaster.

The world of insurance can be confusing, but hopefully this post cleared up some of your uncertainty about renters insurance. Bottom line is: if you’re paying rent, you should have it. If you still have questions, visit MIG’s product page to learn more about our policies, learn more about renters insurance with our tools and resources, or contact us directly.

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