What you need to know about rental property insurance
Home insurance isn’t just for people who own their homes. Even if you rent, you need to have insurance. Rental property insurance covers you for losses due to fine, storms, burglary and more. Read on to find out why you need rental property insurance.
Levels of coverage
Like most types of insurance, rental property insurance companies offer various levels of coverage. Each level costs more or less depending upon the level of coverage each offers. Let’s take a closer look.
Basic coverage: At this level, the rental insurance package you receive from a company such as www.mcdougallinsurance.com/ will insure your rental property from things such as vandalism, water damage from the building’s sprinkler system, fire and lightning. This level of coverage doesn’t cover much more than that, meaning that if your apartment is damaged through other means, such as problems with the boiler, you won’t be covered.
Broad-spectrum coverage: This level of coverage includes every the basic package covers, but also adds in the benefits of coverage from things like broken glass, snow or ice damage, water damage from plumbing issues, etc.
Special coverage: The most comprehensive level of coverage, this type of policy protects against all types of losses other than those that are expressly excluded. Of course, this level of protection is the most expensive.
No matter which level of coverage you opt for, if you make a claim your insurance company will pay for your damages in one of two ways: Actual cash value or replacement cost. With actual cash value, you will receive the cost of replacing the lost, stolen or damaged property (minus depreciation). With replacement cost payouts, the insurance company will pay you the actual amount it would cost to replace the item today. In other words, they pay the value of the items without deducting for depreciation. The premiums for this coverage will cost you more monthly, but you’ll get a higher payout should you ever have to make a claim.
When you rent a property, you can be tempted to put off getting insurance. After all, you don’t own the property, right? Although it is true that the owner of the building also must have homeowner’s insurance, their insurance won’t cover your belongings and property in the event of a disaster or a theft, for example. Remember that when you rent you own everything from the drywall inward, so it’s up to you to protect your things.
We all hope that disaster never strikes that close to home, but the reality is that things happen. Whether it’s bad weather, a burst pipe or a burglary, ensure your belongings by taking out a good rental property insurance policy. You can then rest easy knowing that, should anything go wrong, you are protected. Hopefully you may never need to put in a claim on your insurance, but it’s nice to know that if you do, you will be compensated for your losses.