Compare Homeowners Insurance Rates
in just 2 minutes

HO4 Renter Insurance Plans Are Very Affordable

By Mike Heuer

An HO4 homeowners insurance plan does not insure homes or their contents. Instead, it covers renters and their possessions up to policy limits, but most renters go without the inexpensive coverage, which typically costs between $10 and $20 per month.

A renter insurance plan will provide liability insurance as well as coverage for personal belongings on the premises and even away from it in some instances. If a vehicle is stolen, for instance, and a personal belonging were stolen along with is, such as a cell phone or laptop computer, the renter insurance plan would cover the loss.

Many people do not get renter insurance provided by HO4 homeowners insurance policies for many mistaken reasons. The most common mistake people make when deciding against buying renter insurance is thinking the landlord’s policy will cover their loss, and that just isn’t the case. The landlord’s property insurance only covers the actual building and its components, such as water heaters, heating and cooling systems and appliances. The personal belongings of the renters are not covered and never will be. Nor would the cost of relocating even temporarily.

Many people also forego renter insurance coverage under the assumption they either cannot afford it or because they don’t think they have enough things to insure. But even common furnishings can cost a great deal to replace, particularly on short notice is a sudden tragedy strikes and the apartment and possibly the building containing it suddenly are damaged or destroyed.

And some people think the apartment building in which they live is top-notch and immune to common perils. But even the best-built apartment building can be impacted by a wide variety of dangers, such as an overturned truck or locomotive carrying dangerous chemicals or other possible environmental hazards that result in the building being evacuated.

In such cases, a renter insurance plan would help pay for the costs of temporarily relocating, such as to a hotel while the matter is handled. Power outages also can cause damages, such as to food supplies or even pet fish, some of which can cost a great deal. While many people don’t have aquariums, it is just one example of many potential losses that could be suffered.

While most people understand a renters insurance policy will protect their belongings, many do not realize the extent to which liability coverage might help. The liability portion of renters insurance policies will protect not just against liability for injuries or deaths caused to visitors inside the apartment but also can pay for damages to the apartment for which a landlord attempts to hold the renter financially responsible.

Renter insurance policies generally come in two varieties. One provides actual cash value for items that are damaged, destroyed or stolen from an apartment or while away from the premises. Actual cash value policies take into account depreciation and market value of items when paying claims. Such policies generally are very affordable, and the rates can be lowered by increasing the deductible amount.

The second type of renter insurance plan is a replacement cost policy, which will pay up to policy limits to repair or replace damaged, destroyed or stolen items. Such policies cost more than their counterparts but can be well worth it for many people.