Renters Insurance Policy vs. Homeowners Insurance:
What Is The Difference?
Both homeowners insurance and renters insurance policy provide financial security to the policyholder in case losses happen. Both insurances provide personal property coverage, and liability coverage. Also, both insurance has additional living expenses — should the house or the rented apartment of the insured is uninhabitable, due to covered damages. However, the most significant difference between the two policies is the property they cover. Renters insurance is for tenants or occupiers of a rented apartment or complexes — but renters insurance does not cover the damages to the rented apartment. While homeowners insurance is specifically for individuals or families who own a house, also, homeowners’ insurance could cover the cost of repair to the damages on the dwelling; however, only if the losses are due covered peril only.
Differences Between Renters And Homeowners Insurance Coverages
|Coverage Of Insurance||Renters Insurance||Homeowners Insurance|
|Personal Property Coverage||✔||✔|
|Additional Living Expenses (ALE)||✔||✔|
|Medical Payments Coverage||✔||✔|
Renters And Homeowners Insurance Coverage Overview
1. Dwelling Coverage
2. Perils Excluded From Dwelling Coverage
- Damages due to flood, the homeowner must purchase his flood insurance to protect him from this damages.
- Movements of earth, including damages due to sinkhole landslide, and earthquake, are also excluded from coverage.
- Damages due to the negligence of the homeowner.
- War and nuclear hazards
- Demolition and mandatory rebuilding to keep the building up to the local code
3. Liability Coverage
4. Personal Property Coverage
Both insurances have only a certain sub-limit for the high-value properties of the policyholder. To give an example, suppose that the insured has a $10,000 jewelry, and was stolen. Even though the policyholder has a $20,000 coverage limits for his personal property — the insurer will only pay the insured an amount of $2,000, which is the default sub-limit of most insurance providers minus the deductible rate. However, the payments for personal property coverage of the insured — with regards to its non-high-value properties would depend on the coverage limit of the insured, minus its deductible rate.
5. Additional Living Expenses Coverage (ALE) )
6. Medical Payments Coverage
Annual Premium Rate Based On Your Coverage Limit
|Personal Limit||Liability Limit||Annual Renters Insurance Premium|
What Is The Difference Between The Cost Of This Two Insurance Policies?
Provided that renters insurance doesn’t have dwelling coverage, the most significant difference between the price of both insurances, is that renters insurance is less pricey than homeowners’ insurance. Typically, renters insurance only costs $20 a month, depending on the risk of the proposed insured, and its insurance provider. Homeowners insurance is much more pricey, but this understandable — since homeowners insurance has coverage for the physical structure of the insured’s dwelling. Generally speaking, homeowners’ insurance is more expensive because homes are more massive than apartment units — and with this case, homes have a lot more personal properties to insure than in an apartment unit.
What Is The Average Cost Of This Insurance Policies?
Factors That Can Affect The Cost Of this Insurance Policy
- The limits of coverages the insured purchases
- Deductible rate the policyholder chooses
- Location of the dwelling and the rented apartment
- Usually, if the dwelling or the rented apartment is near a location that has a high crime rate — and near a disaster zone, the tendency is it will garner a higher premium rate.
Common Questions You May Encounter If You Want To Purchase Homeowners Insurance
- Foundation type of building (basement, slab, foundation)
- Sizes of the patios decks, patios, and porches
- Age of the house’s wiring’s
- Materials of the siding
- Age of the plumbing
- Materials use to the roof.
- Is there is a pool?
- Source of heating
- When was the house built? (year)
- Basement — if there is a basement.
Here at Renters Insurance California, we could provide you a quote for homeowners and renters insurance. Get a free quote from A-rated insurance companies.