Your home insurance should protect you in the event of fire, burglary, or other damage, but did you know that there are two types of cover? As a homeowner, the type of policy you take out will be different to that taken out by someone who rents their home. While most people think they understand this difference between renters and homeowners insurance, it’s important to know exactly what this means, in terms of what kind of cover you’re getting.
Renters insurance
If you rent your home rather than own it, your landlord is responsible for insuring the property and any outbuildings. However, this insurance doesn’t provide coverage for your personal belongings, and you will need a separate policy. Renters, or contents, insurance covers your belongings in case of fire or theft, as well as damage to your property caused by an accident or natural disaster, such as a flood.
While renters insurance covers any personal property that is stolen or damaged, it does not usually cover your personal property when you are away from home unless you add this cover as an extra. For example, if you leave your laptop in a coffee shop, you will have to pay for a replacement. However, if your laptop was damaged in a fire at your home, you should be covered (always check the policy details before signing up!) It’s advisable to add accidental damage cover to your insurance, as well as considering an add-on if you carry valuables around with you, including a watch, phone, or laptop. These will often need to be covered separately.
Homeowners insurance
When you buy homeowners insurance, you’re protected against damage to the actual property, which basically means anything you can’t take with you when you move. You’re also usually protected against liability — meaning that if someone is injured in your home due to negligence on your part (accidental or otherwise), your insurer will provide compensation. This insurance applies to the building as well as any outbuildings, such as sheds and garages, Again, check the policy for details.
The biggest difference between the two policies is that homeowners insurance will need to include buildings as well as contents. As a renter, you will only need to cover contents, so your insurance will be cheaper. If you need help finding the perfect insurance for your home, speak to one of our experts today.
