Renting a home can provide residents with a flexible and relaxed living arrangement, allowing them to maintain limited financial investment while still maintaining safety, security and stability in their daily lives. However, while renters may not have a direct stake in the actual structures in which they live, they may still need to account for many of the same risks and exposures as homeowners. With this in mind, understanding the complexities and common misconceptions of renters insurance becomes paramount.
What Are Three Common Renters Insurance Myths?
Renters insurance can be a nuanced and confusing topic, requiring policyholders to fully understand their coverage’s capabilities, limitations and exclusions. Even a slight misunderstanding can have dire ramifications and long-lasting financial repercussions.
Myth: Landlords are responsible for tenants’ belongings. 
Fact: Landlords typically bear no responsibility for their renters’ possessions. In most cases, a landlord’s insurance-related responsibilities entail the exterior of structures, building-wide infrastructure (e.g., heating and electrical systems) and common areas. Renters insurance is needed to cover a tenant’s own possessions and may assist with repair or replacement costs for items such as furniture, electronics and clothing.
Myth: Renters insurance only covers physical belongings.
Fact: Renters insurance policies may include many of the same features as homeowners insurance, including liability coverage and loss-of-use coverage. Liability coverage can help financially protect an insured from third-party losses for which they may be at fault, such as if they injure someone or cause property damage. Meanwhile, loss-of-use coverage can provide financial assistance in response to covered incidents, should they render a home temporarily uninhabitable. As such, a policyholder may recoup expenses arising from these situations, including hotel accommodations, restaurant meals and storage unit fees.
Myth: If a roommate has renters insurance, it can cover all tenants of the residence.
Fact: This is a risky assumption that could result in catastrophic financial losses. While some renters insurance companies may allow policyholders to add their roommates as additional insureds, this may not always be possible. Each resident should ensure they are listed on a policy should roommates decide to share one. It may be generally advisable for each tenant to retain their own coverage, as adding and removing insureds each time someone moves in or out can be difficult. Additionally, when renters share an insurance policy, losses and subsequent claims affecting only one roommate could lead to higher premiums for everyone.
We’re Here to Help
The team at Amco Auto Insurance has helped insure those in the Houston area since 1987. Our team will draw on this extensive knowledge and experience to help tenants understand the details of their coverage and ensure it suits their needs.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.