Homeowners Vs. Renters Insurance: What’s The Difference

Whether you own a house or live as a tenant, it’s essential to ensure your property is protected with an insurance policy.

If you’re a homeowner, then it’s crucial that you invest in a home insurance policy. But if you’re living at a rental house, you should know what your landlord’s insurance policy covers and whether you need to take out a separate renters insurance policy.

However, this can be confusing because both cover damage to property and liability incidents but have different coverage levels and exclusions.

In this blog, we’ll explain what each type of policy covers and what they don’t so you can decide which will work best for your needs!

The Basics

Renters Insurance

Renters insurance is a type of coverage that protects you and your belongings in case of damage. You can use it to help cover your personal property like furniture, electronics, and appliances; it also covers other types of possessions such as jewelry or clothing.

Renters insurance is typically more expensive than homeowners insurance because it offers more protection for items that can’t be replaced easily if damaged or stolen. For example, renters’ policies often include damage from fire and earthquakes (you might not have much cash on hand when these disasters strike). Additionally, if someone breaks into your home while you’re away at work—and doesn’t take anything—they won’t be able to take advantage of this feature either because it only applies toward theft between two residences (or homes).

Homeowners Insurance

Home insurance protects your home and personal property against financial loss due to damage or theft. Homeowners’ insurance usually covers the following:

  • Your home’s structural components, such as walls, floors, and roofs;
  • Personal items inside your home, including furniture and clothing;
  • The value of your contents (that is, everything in your house that isn’t nailed down);
  • If your house has a mortgage, home insurance will also cover any improvements made to the structure during construction or renovation.

The Similarities

A few types of coverage are offered in both renters and homeowners insurance.

Liability Coverage

Liability coverage is a type of insurance that covers legal expenses and damages caused by you or your family members. It also covers any damage from an accident caused by someone else on your property.

Liability coverage can be important if:

  • You have kids, pets, or guests at home who might get into trouble while visiting.
  • Your home has been damaged by weather like flooding or hurricanes (this could happen even if there are no other people in the area).
Monetary investment in home insurance

Medical Payment Coverage

Medical payment coverage, also known as MedPay, is the portion of your homeowner’s insurance policy that covers medical expenses for you and your family. It’s available to renters, too.

Medical payment coverage is separate from your liability coverage. If you’re sued but haven’t met all the terms of your homeowner’s policy, you can still be sued for medical payments.

Medical payment coverage protects you and your family against liability in the event of a covered loss. It also covers reasonable and necessary out-of-pocket expenses like lost wages or attorney fees if someone else makes a claim against you.

You don’t need to buy medical payment coverage if your homeowner’s policy already has this type of coverage. But adding it to your policy will give you greater protection if you need it, especially if there’s more than one person on your policy who might be involved in an accident or other loss.

Animated family under umbrella

The Differences

Homeowners’ Insurance Offers Personal Property Coverage

Personal property coverage is a form of home insurance that covers your personal belongings. It’s how you protect items like furniture, electronics, and other household items.

Personal property coverage is especially important if you own expensive items like jewelry or fine art that you can’t replace easily with cash. If your home were to burn down in a fire, these things would be lost unless the policyholder insured them. The cost of replacing these items could be substantial for their replacement value and loss of income due to time spent trying to locate replacements at thrift stores or online auction sites before making repairs on the house itself (if there was any damage).

Renters’ Insurance Policy Offers Additional Living Expense (ALE) Coverage

Even if you’re not an owner of a home, your renter’s insurance policy may provide other additional living expenses (ALE) coverage. Suppose a covered event damages your house, and you need to move out. In that case, the insurance company will pay for a hotel, restaurant, and other reasonable expenses incurred during this period.

This additional living expenses endorsement is most commonly found on standard multi-family policies issued by commercial property insurers.

Does Your Landlord Have Some Renter’s Insurance?

If your landlord has insurance, it offers liability and ALE coverage. If you are a tenant and have questions about what is covered under the policy, ask your landlord for transparency.

If there is no renters’ insurance, consider getting one so that if something happens at home while renting from someone else (like an earthquake), it won’t be too expensive for you to deal with the repairs or replacement costs.

A person holding a home insurance form

Speak To An Insurance Agent In Indian Orchard

Western Auto Mass Insurance has been the leading insurance provider to homeowners living in Indian Orchard since 2014. Our insurance providers will assist you in managing all insurance policy issues and will walk you through the financial decision-making process.

In addition to home insurance, we also offer business vehicle insurance and auto insurance. The nicest part about purchasing insurance policies from us is the savings you receive when you combine house and auto insurance.

We also offer registry services where it only takes 15 minutes for you to get insurance or a license plate.

Look at what our customers have to say about our auto insurance services.

Get in touch with one of our insurance providers!